Multiple Choice Questions 1. The following are the factors to be considered in Suitability, except A. Environment B. Capabilities C. Expectations D. Scenarios 2. The ____________ for a firm is the internal rate of return on existing investments, based on real cash flows. A. cash flow return on investment (CFROI) B. Economic Value Added (EVA) C. Total Shareholders Return D. Return on Investment 3. The elements that must be considered in using EVA are as follows, except ___________. A. Reasonableness of earnings B. Appropriate cost of Capital C. Volatility of the market D. None of the above

Q: could you explain the purposes of business portfolio analysis and diversification analysis,…

A: Diversification: It is the phenomena of spreading the investment around so that exposure limited to…

Q: Which of the following statements is TRUE? a. The primary goal of financial management is to…

A: Financial Management deals with the maximization of shareholder worth, reduce the cost of finance…

Q: Financial statement analysis is used to evaluate a firm's liquidity position, solvency position, and…

A: Financial statement analysis is the process of reviewing and analyzing a company's financial…

Q: Select all that is true about the role of financial managers and the types of financial decisions…

A: B  . The duties of the financial manager includes determining the capital structure and which…

Q: A. Operating expenses are a function of: a. The cost of equity and the cost of debt b. The…

A: Operating Expenses: In the business world, an operational expenditure is a cost that a company…

Q: Which two types of investment criteria are most frequently used by managers today? Multiple Choice O…

A: Net Present Value (NPV) is the difference between present value of cash inflows and present value of…

Q: The higher the _____________, the higher the financial risk, and the higher the ____________. a.…

A: Interest rates and price of bonds has reverse relationship. With increase in interest rates, the…

Q: Which of the following is the primary goal of a firm? Select one: O a. maximize stockholder wealth O…

A: Every firm and its management must have a primary goal which it must focus on achieving. The primary…

Q: Which of the following statement is correct Select one:

A: There are various types of decisions to be taken any a manager regarding working capital, capital…

Q: Give an example of how a company can assess investment possibilities to make sure their choice…

A: The answer :

Q: Which of the following statements is true? a. Determining how day-to-day financial matters should…

A: The business function referred to as management is responsible for allocating the funds available so…

Q: Which of the following is Return on equity. O Economic value. O Market capitalization. O Firm…

A: There are many tools to measure the performance and compare with other firms and that will help in…

Q: Introduction Net Present Value is a financial measure used to evaluate the profitability of an…

A: Solution given below Explanation:Step 1:The Net Present Value (NPV) is a fundamental concept in…

Q: Which one is LEAST likely to be considered in developing financial strategies? a. Investment and…

A: Financial strategy of a company or an organization is concerned with the procurement of funds and…

Q: Describe its significance along with the characteristics that determine the quality of a market?

A: A financial market is a market where people buy or sell financial securities at a low transaction…

Q: ____________ is one of the most important function of a finance manager where he/she has to execute…

A: Finance managers have 3 functions:- Investment decisions Financing decisions Dividend decisions

Q: The firm has contacted a bank to negotiate a loan to purchase the legal tech' software. A loan of…

A: Simple interest is one inw hich the interest earned on investment does not earn interest on it. It…

Q: Which of the following investment objectives that is usually seeks to keep account values stable?…

A: Investors have different options to make investments, and the motive behind investments is to…

Q: ccording to Miller and Modigliani, it is at really determines a firm's value.

A: According to M&M, value of firm is the sum of present value of all future cash flows.

Q: Based on the assumption efficient capital market is characterized by rationality and risk aversion,…

A: When a business attempts to maximize the wealth of their firm, they are really attempting to build…

Q: Analysis of firm profitability – indicators, their meanings and relation to each other, methodical…

A: The income statement is a financial statement that shows the income and expenses of a company. It…

Q: The financial ratios which address the question: Has the firm earned adequate returns on its…

A: Financial Ratios tells us about company's fianncial performance and helps in comparing with…

Q: The company cost of capital: measures the return that investors require from the company. is…

A: The company's cost of capital is the return that the investors expect in return for financing the…

Q: value of a firm is influenced by three types of financial decisions, including

A: The value of firm is influenced by three financial decisions  (a)investment decisions: Concern with…

Q: What is the blend of long-term ncial sources used to finance the n which may include debt, equity…

A: Explanation: The above options can be explained as follows: a) Working capital : Working capital is…

Q: How do managers, bankers, and security analysts use (a) trend analysis, (b) benchmarking,(c) percent…

A: Introduction: Usually a managers, bankers, and security analysts use financial tools and techniques…

Q: Using the equity method for reporting strategic investments, how does investment revenue and…

A: A company uses equity method for reporting investments when its ownership interest in the investee…

Q: For a firm, the Optimal Capital Structure means to choose between equity and bonds so to   a.…

A: Optimal capital structure is that mix of debt and equity that enables a company to maximize its…

Q: As part of his duties, if a finance manager of a company is working on the appropriate source of…

A: Financial management is the practice of collecting and managing cash flows. Cash management is vital…

Q: “Efficient working Capital management leads to improve the operating performance of the business…

A: Effective management of working capital stands as a foundational element in financial strategy,…

Q: By applying capital to investments with long-term benefits, the company is attempting to produce…

A: The company acquires funds to run its business and using the funds it creates value in the market.…

Q: Analyst forecasts which focus on a top-down approach to forecasting future performance are most…

A: Top down approach in fundamental analysis involves analysis of macroeconomic factors first, then…

Q: What decisions do managers take that is focused on the financial wellbeing of the company and…

A: 4. The financial decision includes the decisions related to the raising or distributing finances of…

Q: Financial Forecasting Assumptions – Financial forecasting projects a firm’s future financial needs.…

A: Financial forecasting is a crucial process for businesses to plan and prepare for the future. It…

Q: Venture capital is a.debt resource  b. Profit resource  c. Internal financial resource d.…

A: The correct option with proper explanation are as follows