Fin100-hk1. Principles Of Finance Mid Term Actual

FIN100–HK1. PRINCIPLES OF FINANCE (FIN100-HK1) > EXAMS > REVIEW ASSESSMENT: MIDTERM EXAM

Name

Midterm Exam

Status

Completed

Score

82 out of 100 points

Question 1

2 out of 2 points

“The markets are quick and the prices are right” describes a market that is:

Selected Answer:

efficient

Correct Answer:

efficient

Question 2

2 out of 2 points

The firm obtains cash from which of the following:

Selected Answer:

all of the above

Correct Answer:

all of the above

Question 3

2 out of 2 points

Which of the following goals of the firm are synonymous (equivalent) to the maximization of

shareholder wealth?

Selected Answer:

maximization of the total market value of the firm’s common stock

Correct Answer:

maximization of the total market value of the firm’s common stock

Question 4

2 out of 2 points

The cash conversion cycle exceeds the sum of days of sales outstanding and days of sales in

inventory.

Selected Answer:

False

Correct Answer:

False

Question 5

2 out of 2 points

One of the benefits of organized security exchanges is that they are said to provide a _____

market.

Selected Answer:

continuous

Correct Answer:

continuous

Question 6

2 out of 2 points

Which of the following ratios would be the most useful to assess the risk associated with a

firm being able to pay off its short-term line of credit?

Selected Answer:

The acid test ratio.

Correct Answer:

The acid test ratio.

Question 7

2 out of 2 points

Capital market instruments include:

Selected Answer:

corporate equities

Correct Answer:

corporate equities

Question 8

2 out of 2 points

Most sole proprietorships convert to a corporation within a few years due to increasing state

and federal regulations.

Selected Answer:

False

Correct Answer:

False

Question 9

2 out of 2 points

Which of the following financial ratios is the best measure of the operating effectiveness of a

firm’s management?

Selected Answer:

OIROI

Correct Answer:

OIROI

Question 10

2 out of 2 points

Which of the following ratios would be the best way to determine how customers are paying

for their purchases?

Selected Answer:

Average collection period.

Correct Answer:

Average collection period.

Question 11

2 out of 2 points

Which of the following is a real asset?

Selected Answer:

inventory

Correct Answer:

inventory

Question 12

2 out of 2 points

Shareholders react to poor investment or dividend decisions by causing the total value of the

firm’s stock to fall, and they react to good decisions by bidding the price of the stock up.

Selected Answer:

True

Correct Answer:

True

Question 13

2 out of 2 points

Benefits of an organized security exchange include:

Selected Answer:

all of the above

Question 14

0 out of 2 points

Question 15

2 out of 2 points