Question 1

A financial plan outlines the funds needed for a certain period of time.

Accepted Answer

A) True 
 B)False

Question 2

Highly leveraged companies will have adequate funds to spend on advertising,staffing,and product development.

Accepted Answer

A) True 
 B)False

Question 3

A business can use short-term financing to cover current expenses.Typically,short-term financing will be repaid in one year.

Accepted Answer

A) True 
 B)False

Question 4

Hedging refers to forming contracts that allow a company to ________.

Accepted Answer

A)  obtain funds for a short period without paying interest 
B)  buy supplies in the future at designated prices 
C)  finance long-term debt on a continuous basis 
D)  engage in buyer-seller relationships with many firms 
E)  issue letters of credit to buyers exterior to the home country 
A)  obtain funds for a short period without paying interest 
B)  buy supplies in the future at designated prices 
C)  finance long-term debt on a continuous basis 
D)  engage in buyer-seller relationships with many firms 
E)  issue letters of credit to buyers exterior to the home country

Question 5

________ is an agreement to use an asset in exchange for regular payment.

Accepted Answer

A)  Credit card 
B)  Lease 
C)  Mortgage 
D)  Trade credit 
E)  Commercial paper 
A)  Credit card 
B)  Lease 
C)  Mortgage 
D)  Trade credit 
E)  Commercial paper

Question 6

Explain why businesses use factoring to raise funds.

Accepted Answer

Businesses with slow-paying trade credit

Question 7

________ accounts represent a firm's cash on hand as well as economic value that can be converted to cash or is expected from customers,minus what it is scheduled to pay out.

Accepted Answer

A)  Capital budget 
B)  Trade credit 
C)  Project budget 
D)  Working capital 
E)  Operating budget 
A)  Capital budget 
B)  Trade credit 
C)  Project budget 
D)  Working capital 
E)  Operating budget

Question 8

Burn rate is a major concern when preparing a(n)________ budget.

Accepted Answer

A)  start-up 
B)  operating 
C)  capital 
D)  project 
E)  master 
A)  start-up 
B)  operating 
C)  capital 
D)  project 
E)  master

Question 9

Short-term financing is financing that will typically be repaid within ________.

Accepted Answer

A)  one year 
B)  two years 
C)  three years 
D)  five years 
E)  ten years 
A)  one year 
B)  two years 
C)  three years 
D)  five years 
E)  ten years

Question 10

Compare and contrast various types of budgets.

Accepted Answer

Start-up budget is a budget that identif

Question 11

Explain the concept of risk/return trade-off.

Accepted Answer

Most financial decisions involve balanci

Question 12

Rolling forecasts are not based on revenue budgets and cost assumptions.

Accepted Answer

A) True 
 B)False

Question 13

Compare and contrast debt financing and equity financing.

Accepted Answer

Debt financing refers to arranging fundi

Question 14

Financing would cost more if ________.

Accepted Answer

A)  opportunity cost is low for the financier 
B)  investors lend less money 
C)  funding is for long-term 
D)  perceived risk is less 
E)  a company is financially solid 
A)  opportunity cost is low for the financier 
B)  investors lend less money 
C)  funding is for long-term 
D)  perceived risk is less 
E)  a company is financially solid

Question 15

Private equity refers to ________.

Accepted Answer

A)  shares that are owned by institutions rather than individuals 
B)  ownership assets that aren't publicly traded 
C)  preference shares issued by a corporation 
D)  shares that are traded in stock exchanges 
E)  shares that are owned by individuals rather than institutions 
A)  shares that are owned by institutions rather than individuals 
B)  ownership assets that aren't publicly traded 
C)  preference shares issued by a corporation 
D)  shares that are traded in stock exchanges 
E)  shares that are owned by individuals rather than institutions

Question 16

Frost Bank lends $500,000 to Arbex Manufacturer.Arbex has agreed to pay this amount back in fifty equal installments over a period of ten years.This is an example of a ________.

Accepted Answer

A)  lease agreement 
B)  trade credit 
C)  corporate bond 
D)  long-term loan 
E)  commercial paper 
A)  lease agreement 
B)  trade credit 
C)  corporate bond 
D)  long-term loan 
E)  commercial paper

Question 17

________ budget identifies the money a new company will need to spend to launch operations.

Accepted Answer

A)  Master 
B)  Start-up 
C)  Capital 
D)  Project 
E)  Operating 
A)  Master 
B)  Start-up 
C)  Capital 
D)  Project 
E)  Operating

Question 18

Which of the following is a component of a firm's working capital account?

Accepted Answer

A)  long-term loans 
B)  debentures 
C)  inventory 
D)  mortgage bonds 
E)  convertible bonds 
A)  long-term loans 
B)  debentures 
C)  inventory 
D)  mortgage bonds 
E)  convertible bonds

Question 19

Term loans have maturities between three months to one year.

Accepted Answer

A) True 
 B)False

Question 20

Venture capital is an example of private equity.

Accepted Answer

A) True 
 B)False

A financial plan outlines the funds needed for a certain period of time.

Highly leveraged companies will have adequate funds to spend on advertising,staffing,and product development.

A business can use short-term financing to cover current expenses.Typically,short-term financing will be repaid in one year.

Hedging refers to forming contracts that allow a company to ________.

________ is an agreement to use an asset in exchange for regular payment.

Explain why businesses use factoring to raise funds.

________ accounts represent a firm's cash on hand as well as economic value that can be converted to cash or is expected from customers,minus what it is scheduled to pay out.

Burn rate is a major concern when preparing a(n)________ budget.

Short-term financing is financing that will typically be repaid within ________.

Compare and contrast various types of budgets.

Explain the concept of risk/return trade-off.

Rolling forecasts are not based on revenue budgets and cost assumptions.

Compare and contrast debt financing and equity financing.

Financing would cost more if ________.

Private equity refers to ________.

Frost Bank lends $500,000 to Arbex Manufacturer.Arbex has agreed to pay this amount back in fifty equal installments over a period of ten years.This is an example of a ________.

________ budget identifies the money a new company will need to spend to launch operations.

Which of the following is a component of a firm's working capital account?

Term loans have maturities between three months to one year.

Venture capital is an example of private equity.

Developing a Business Mindset

Understanding Basic Economics

The Global Marketplace

Business Ethics and Corporate Social Responsibility

Forms of Ownership

Entrepreneurship and Small Business Ownership

Management Roles, Functions, and Skills

Organization and Teamwork

Production Systems

Employee Motivation

Human Resources Management

Labor Relations

The Art and Science of Marketing

Product and Pricing Strategies

Distribution and Marketing Logistics

Customer Communication

Financial Information and Accounting Concepts

Financial Markets and Investment Strategies

The Money Supply and Banking Systems

Filters

Exam 18: Financial Management

A financial plan outlines the funds needed for a certain period of time.

Highly leveraged companies will have adequate funds to spend on advertising,staffing,and product development.

A business can use short-term financing to cover current expenses.Typically,short-term financing will be repaid in one year.

Hedging refers to forming contracts that allow a company to ________.

________ is an agreement to use an asset in exchange for regular payment.

Explain why businesses use factoring to raise funds.

________ accounts represent a firm's cash on hand as well as economic value that can be converted to cash or is expected from customers,minus what it is scheduled to pay out.

Burn rate is a major concern when preparing a(n)________ budget.

Short-term financing is financing that will typically be repaid within ________.

Compare and contrast various types of budgets.

Explain the concept of risk/return trade-off.

Rolling forecasts are not based on revenue budgets and cost assumptions.

Compare and contrast debt financing and equity financing.

Financing would cost more if ________.

Private equity refers to ________.

Frost Bank lends $500,000 to Arbex Manufacturer.Arbex has agreed to pay this amount back in fifty equal installments over a period of ten years.This is an example of a ________.

________ budget identifies the money a new company will need to spend to launch operations.

Which of the following is a component of a firm's working capital account?

Term loans have maturities between three months to one year.

Venture capital is an example of private equity.

Developing a Business Mindset

Understanding Basic Economics

The Global Marketplace

Business Ethics and Corporate Social Responsibility

Forms of Ownership

Entrepreneurship and Small Business Ownership

Management Roles, Functions, and Skills

Organization and Teamwork

Production Systems

Employee Motivation

Human Resources Management

Labor Relations

The Art and Science of Marketing

Product and Pricing Strategies

Distribution and Marketing Logistics

Customer Communication

Financial Information and Accounting Concepts

Financial Markets and Investment Strategies

The Money Supply and Banking Systems

Filters