BMU_IBM_11

What is a key measure of a company's financial health?

• Net Profit Margin

• Debt-to-Equity Ratio

• Gross Revenue

• Operating Costs

What is working capital typically used for?

• Long-term investments

• Day-to-day business operations

• Employee training programs

• Market research

What is the typical duration of short-term finance?

• Up to 1 year

• 1-3 years

• 5-10 years

• Over 10 years

Which of the following is an example of short-term finance?

• Mortgage

• Trade Credit

• Issuing Debentures

• Equity Finance

What is a bank overdraft?

• A loan for purchasing raw materials

• An account where money earns interest

• Permission to withdraw more than the current account balance

• A savings account used for capital investments

What does factoring involve?

• Selling company shares

• Leasing equipment

• Selling debts to raise finance

• Deferring payments to suppliers

Which method allows businesses to pay in installments for equipment?

• Trade Credit

• Hire-Purchase

• Factoring

• Leasing

What is the usual period for medium-term finance?

• 1-3 years

• 3-10 years

• 10-15 years

• Over 15 years

Which industry commonly uses leasing for its operations?

• Retail

• Airline

• Construction

• Technology

What distinguishes leasing from hire-purchase?

• Leasing has lower interest rates

• Leased items are not owned by the lessee

• Leasing requires full upfront payment

• Lease agreements cannot be terminated early