Business Finance - Quiz #2

What is the primary purpose of a financial market?

• Providing loans to individuals and organizations

• Exchanging goods and services

• Trading financial instruments

• Manufacturing financial instruments

Which of the following is NOT a financial instrument?

• Stocks

• Bonds

• Real Estate

• Options

In the flow of funds within an organization, what is the role of the financial manager when allocating funds?

• Prioritizing marketing campaigns

• Ensuring efficient resource allocation

• Supervising manufacturing processes

• Managing employee training

What financial statement displays a company's revenues and expenses over a specific period?

• Balance Sheet

• Income Statement

• Cash Flow Statement

• Statement of Stockholder's Equity

What is the final step in the financial planning process?

• Developing a financial plan

• Setting financial goals

• Monitoring and revising the plan

• Gathering financial data

What is a common requirement for obtaining a mortgage loan from traditional banks?

• High credit score

• A government-issued ID

• No proof of income needed

• Minimum age of 18

Which type of institution is more likely to offer unsecured personal loans with relaxed credit requirements?

• Traditional banks

• Credit unions

• Online lenders

• Local government agencies

If you invest $1,000 at an annual interest rate of 6%, how much will you have after 5 years, compounded annually?

• $1,133

• $1,338

• $1,790

• $1,628

What is the present value of receiving $500 in three years, assuming a discount rate of 8%?

• $400

• $400.58

• $460

• $520

In a 3-year loan with an annual interest rate of 5%, what will be the monthly payment for a loan of $10,000 using the amortization formula?

• $299.71

•  $358.40

• $500

• $750