Finance Skills for Managers - D076
Questions and Answers Rated A
Which area of finance deals with sources of funding and the capital structure of corporations and
seeks to increase the value of a firm to its owners? ✔
...
Finance Skills for Managers - D076
Questions and Answers Rated A
Which area of finance deals with sources of funding and the capital structure of corporations and
seeks to increase the value of a firm to its owners? ✔✔Business finance
What is the primary difference between finance and accounting? ✔✔Finance focuses on the
future, while accounting is generally backward-looking.
Which subspecialty of finance primarily involves deciding which assets will create more wealth
and earn positive returns? ✔✔Investments
What is the primary goal of the financial manager of a firm? ✔✔To maximize owner wealth
What should be the main question a firm asks when considering any investment decision?
✔✔Do the benefits of this investment outweigh the costs?
What is the primary aim of personal finance goals? ✔✔To maximize satisfaction from products
purchased and services obtained
Which task does a financial manager perform when choosing to obtain a loan to purchase a piece
of equipment for a new project? ✔✔Making financing decisions
Which financial career focuses on investing capital into firms whose shares are not currently sold
on any public stock exchange? ✔✔Private equity
Which task does a financial manager perform when assessing the costs and benefits of potential
projects? ✔✔Making investment decisions
What tool can you use to understand your overall personal cash flows? ✔✔Budgeting
What is a reasonable alternative to keeping an emergency stash of cash? ✔✔Investing in a
savings account
You want to buy a house, so you obtain a mortgage for which you can afford the monthly
payments. What process have you engaged in as part of your financial decision-making?
✔✔Financing
What area of finance involves deciding which assets to invest in to create wealth in the future?
✔✔Investments
Hannah is the financial manager of a firm. A project that she has recommended has been
approved and will cost $5 million. Since the company does not have enough cash on reserve,
Hannah must figure out how to raise enough money to start the project. She can choose whether
to issue new bonds, new stocks, a mortgage loan, or some combination of those options. What
task is Hannah performing in this scenario? ✔✔Making a financing decision
Maria and Mateo are setting financial goal
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