Advanced Financial Management

1-Financial Management is mainly concerned with ____________.

• A. all aspects of acquiring and utilizing financial resources for firm’s activities

• B. arrangement of funds

• C. efficient Management of every business.

• D. profit maximization

2-In his traditional role the finance manager is responsible for ____________.

• A. arrange of utilization of funds.

• B. arrangement of financial resources.
  

• C. effective management of capital.

• D. acquiring capital assets of the organization.

3. The primary goal of the financial management is ____________.

• A. to maximize the return

• B. to minimize the risk.

• C. to maximize profit.

• D. to maximize the wealth of owners.

4. Capital budgeting is related to ____________.

• A. short term assets.

• 
  B. long terms assets.
  
  

• C. long terms and short terms assets.

• D. fixed assets.

5. A way to analyze whether debt or lease financing would be preferable is to:

• A. compare the net present values under each alternative, using the cost of capital as the discount rate.

• B. compare the net present values under each alternative, using the after-tax cost of borrowing as the
  discount rate.

• C. compare the payback periods for each alternative.

• D. compare the effective interest costs involved for each alternative

6. Future value interest factor takes ____________.

• A. Discounting rate.

• B. Compounding rate

• C. Inflation rate.

• D. Deflation rate.

7. Present value takes ____________.

• A. Compounding rate.

• B. Discounting rate.

• C. Inflation rate.

• D. Deflation rate.

8. Financial decisions involve ____________.

• A. Investment, financing and dividend decisions.

• B. Investment sales decisions.

• C. Financing cash decisions.

• D. Investment dividend decisions.

9. The company’s cost of capital is called ____________.

• A. Leverage rate

• B. Hurdle rate.

• C. Risk rate.

• D. Return rate.

10. Market value of the shares are decided by ____________.

• A. the respective companies.

• B. the investment market.

• C. shareholders.

• D. the government.