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1) financial planning encompasses all but the following:
a.setting long-run strategic goals
b.investing the firms long-term cash
c.preparing quarterly and annual budgets
d.all of the above
2) a firm may be unable to accept all projects that are expected to have positive npvs
due to:
a.the lack of funds
b.the lack of trained and reliable personnel
c.conflicting decisions by the irr method
d.both (a) and (b) are true
e.all of the above are true
3) which statement is false regarding risk and return?
a.for broad asset classes, the relationship between risk and return is nearly linear
b.adding multiple stocks to a portfolio can reduce non-systematic risk
c.there is a nearly linear relationship between risk and return for individual stocks
d.because investors can easily eliminate risk through diversification, investors should
only be rewarded for non-diversifiable risk
