FINA 3310 SUMMER 1 Test 1

Which one of the following forms of business organization offers liability protection to some of its owners but not to all of its owners?

Limited partnership

Capital budgeting includes the evaluation of which of the following?

Size, timing, and risk of future cash flows

Which one of the following parties can sell shares of ABC stock in the primary market?

ABC company

The potential conflict of interest between a firm's owners and its managers is referred to as which type of conflict?

Agency

A sole proprietorship

has its profits taxed as personal income

Corporate shareholders:

have the ability to change the corporation's bylaws.

A corporation:

is a legal entity separate from its owners.

A limited liability company (LLC):

prefers its profits be taxed as personal income to its owners.

The issuer of a security must be involved in all _____ transactions involving that security.

primary market

The primary goal of financial management is to maximize:

the market value of existing stock.

In a general partnership, each partner is personally liable for:

the total debts of the partnership, even if he or she was unaware of those debts.