WorksheetsDECA - Finance Exam // Practice 3
Total questions: 20
Worksheet time: 10mins
As financial intermediaries, what is all financial institutions' primary responsibility?
A. Transferring money from those who have it to those who need it
B. Investing clients' money in mid-cap growth companies
C. Calculating the opportunity costs of clients' potential investments
D. Conducting fundamental and technical analyses to evaluate securities
Which type of financial institution facilitates the buying and selling of securities between investors?
A. Savings and loan associations
B. Brokerage firms
C. Insurance companies
D. Credit unions
Mortgages and government bonds are examples of
A. interest-free services.
B. debt instruments.
C. equity products.
D. unrated investments.
Which of the following is a characteristic of a call market:
A. Buyers and sellers determine prices.
B. Buy orders are made at specific times.
C. Trades occur continuously.
D. Prices change from moment to moment.
Which of the following is an ethical principle that is applicable to finance:
A. Incrementalism
B. Competence
C. Self-interest
D. Framing
The Money for You Bank recently merged with the Keeping You Safe Insurance Company. The merger is an example of __________ in the finance industry.
A. tactical planning
B. consolidation
C. convergence
D. licensing
When a business reviews a customer's credit application, it is evaluating risks associated with the
A. customer's beneficiaries.
B. business's reporting strategies.
C. business's accounting processes.
D. customer's ability to pay.
According to most analysts, the three economic indicators that stock market investors and traders should pay the closest attention to are
A. gross domestic product, overhead expenses, and unemployment.
B. gross domestic product, unemployment, and inflation.
C. inflation, unemployment, and bonds rates.
D. interest rates, overhead expenses, and inflation.
When a country is experiencing a recession, which of the following typically occurs first:
A. Stock prices increase
B. A stock market crash
C. A stock market recovery
D. Stock prices decrease
Which of the following statements about hedge funds is true:
A. Hedge funds involve private investment partnerships.
B. Government agencies usually manage hedge funds.
C. Investment options for hedge funds are limited in scope.
D. Hedge funds are designed to generate conservative financial returns.
An increase in free-flowing capital is a benefit of
A. global protectionism.
B. economic conservatism.
C. investor innovation.
D. financial globalization.
When preparing a statement of equity, what does a business deduct from its total net income to obtain its retained earnings?
A. Bad debt
B. Depreciation of assets
C. Sales tax payable
D. Dividends paid
One of the benefits of marginal analysis is
A. understanding the impact of sunk costs.
B. optimal decision-making.
C. improved workplace communication.
D. improved long-term strategy.
Which of the following is a responsibility of a managerial accountant:
A. Compiling the company's financial information for release to the public
B. Training employees and management on personal financial literacy
C. Making managerial decisions regarding planning, pricing, and sales
D. Conducting a cost analysis and explaining the findings to management
In corporate governance, oversight of management, segregation of control, and policy development are all examples of
A. tasks of the board of directors.
B. internal control mechanisms.
C. transparency in management.
D. external control mechanisms.
Budgets are important to the management process because they
A. remove the possibility of financial constraints.
B. shift focus from future events to daily issues.
C. ensure that organizational goals come before personal goals.
D. help determine roles and responsibilities.
Which of the following is a cost driver that could affect the cost of internet service in a coffee shop:
A. Number of ingredients per product
B. Number of products sold
C. Number of direct labor hours
D. Number of customers
A financial information management system is often responsible for
A. assisting in the preparation of financial statements.
B. supervising the accounting and finance departments.
C. purchasing raw materials for production.
D. developing a corporate investment portfolio.
Financial information management is responsible for collecting, maintaining, and reporting data about financial transactions. Business managers often use these data to
A. develop secondary equity markets.
B. determine if liability insurance is needed.
C. forecast financial inflows and outflows.
D. calculate the level of corporate groupthink.
To guard against intentional ethical violations, such as deliberate financial data tampering, an organization should maintain
A. hard copies of all documents.
B. audit trails of data changes.
C. daily balance sheets.
D. an accounts receivable schedule.
