Corp.fin, Test 1solutions

Corp.fin, Test 1solutions - Corporate Finance (MBA-5131)...

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Corporate Finance (MBA-5131) Test 1 ame __________________ 1. The person generally directly responsible for overseeing the cash and credit functions, financial planning, and capital expenditures is the: a. treasurer. b. director. c. controller. d. chairman of the board. e. chief operations officer. 2. A business formed by two or more individuals who each have unlimited liability for business debts is called a: a. corporation. b. sole proprietorship. c. general partnership. d. limited partnership. e. limited liability company. 3. The primary goal of financial management is to: a. maximize current dividends per share of the existing stock. b. maximize the current value per share of the existing stock. c. avoid financial distress. d. minimize operational costs and maximize firm efficiency. e. maintain steady growth in both sales and net earnings. 4. Agency costs refer to:
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a. the total dividends paid to stockholders over the lifetime of a firm. b. the costs that result from default and bankruptcy of a firm. c. corporate income subject to double taxation. d. the costs of any conflicts of interest between stockholders and management. e. the total interest paid to creditors over the lifetime of the firm. 5. Which one of the following is a capital budgeting decision? a. determining how much debt should be borrowed from a particular lender b. deciding whether or not to open a new store c. deciding when to repay a long-term debt d. determining how much inventory to keep on hand e. determining how much money should be kept in the checking account - 2 - 6. Which one of the following statements is correct?
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This note was uploaded on 06/18/2010 for the course MBA MBA 5131 taught by Professor Mm during the Summer '10 term at Cumberland TN.

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Corp.fin, Test 1solutions - Corporate Finance (MBA-5131)...

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