Finance > TEST BANKS > 1-4 Practice Tests FIN 3716 (All)
1-4 Practice Tests FIN 3716 1. Which one of the following terms is defined as the management of a firm's long-term investments? A. working capital management B. financial allocation C. agency co ... st analysis D. capital budgeting E. capital structure Refer to section 1.1 2. Which one of the following terms is defined as the mixture of a firm's debt and equity financing? A. working capital management B. cash management C. cost analysis D. capital budgeting E. capital structure 3. Which one of the following is defined as a firm's short-term assets and its short-term liabilities? A. working capital B. debt C. investment capital D. net capital E. capital structure 4. A business owned by a solitary individual who has unlimited liability for its debt is called a: A. corporation. B. sole proprietorship. C. general partnership. D. limited partnership. E. limited liability company. Refer to section 1.2 5. A business formed by two or more individuals who each have unlimited liability for all of the firm's business debts is called a: A. corporation. B. sole proprietorship. C. general partnership. D. limited partnership. E. limited liability company. 6. A business partner whose potential financial loss in the partnership will not exceed his or her investment in that partnership is called a: A. generally partner. B. sole proprietor. C. limited partner. D. corporate shareholder. E. zero partner. 31. Dee's has a fixed asset turnover rate of 1.12 and a total asset turnover rate of 0.91. Sam's has a fixed asset turnover rate of 1.15 and a total asset turnover rate of 0.88. Both companies have similar operations. Based on this information, Dee's must be doing which one of the following? A. utilizing its fixed assets more efficiently than Sam'sB.utilizing its total assets more efficiently than Sam'sC. generating $1 in sales for every $1.12 in net fixed assetsD. generating $1.12 in net income for every $1 in net fixed assetsE. maintaining the same level of current assets as Sam's 32. Ratios that measure how efficiently a firm manages its assets and operations to generate net income are referred to as _____ ratios. 33. If a firm produces a twelve percent return on assets and also a twelve percent return on equity, then the firm: 34. Which one of the following will decrease if a firm can decrease its operating costs, all else constant? 35. Al's has a price-earnings ratio of 18.5. Ben's also has a price-earnings ratio of 18.5. Which one of the following statements must be true if Al's has a higher PEG ratio than Ben's? A. Al's has more net income than Ben's.B.Ben's is increasing its earnings at a faster rate than the Al's.C. Al's has a higher market value per share than does Ben's.D. Ben's has a lower market-to-book ratio than Al's.E. Al's has a higher net income than Ben's. [Show More]
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