HI5002 QUIZ

Lecture 1: Introduction to Finance for Business

1. The process of planning and managing a firm’s long-term investments is

called______________________________
2. Bonds are Debt; Shares are ____________________________
3. __________________________________________ deals with managing cash flows as they arise
in the firms day-to-day operations
4. Investors respond to new information by______________________; therefore stock market
prices are assumed to reflect all information.
5. Intermediaries are financial institutions and markets that help bring _______________and
____________together.
6. Finance is intimately woven into any aspect of the business that involves the payment or receipt
of money in the future. True / False
7. The ultimate goal of a finance manager is profit maximization True / False
8. To increase shareholder wealth, financial managers should not use unethical means. True / False
9. Money has time value. True / False
10. Managers, as agents, respond to incentives they are given in the workplace. True / False

Answers

1. Capital budgeting
2. Equity
3. working capital management
4. buying and selling
5. borrowers and savers
6. True
7. False. The ultimate goal of a finance manager is to maximize the share price or company value
8. True
9. True
10. True