Midterm - Finance

Working capital management includes which one of the following?

Determining which customers will be granted credit

Probably the least effective means of aligning management goals with shareholder interests is:

automatically increasing management salaries on an annual basis.

The goal of financial management is to increase the:

current market value per share.

When conducting a financial analysis of a firm, financial analysts:

frequently use accounting information.

The primary goal of financial management is most associated with increasing the:

market value of the firm.

A limited liability company (LLC):

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

The daily financial operations of a firm are primarily controlled by managing the:

working capital.

Which one of the following situations is most apt to create an agency conflict?

Basing management bonuses on the length of employment

The Sarbanes-Oxley Act in 2002 was primarily prompted by which one of the following from the 1990s?

Corporate accounting and financial fraud

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

Which one of the following statements is correct?

All over-the-counter sales occur in dealer markets.

Which one of the following applies to a general partnership?

Any one of the partners can be held solely liable for all of the partnership's debt.

Silvia is employed as a currency trader in the Japanese yen market. Her job falls into which one of the following areas of finance?

Capital management

Deandre and Mason both enjoy sunshine, water, and surfboards. Thus, the two friends decided to create a business together renting surfboards, paddle boats, and inflatable devices in California. Deandre and Mason will equally share in the decision making and in the business profits or losses. Which type of business did they create if they both have full personal liability for the firm's debts?

General partnership

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

Which one of the following statements is correct?

The primary purpose of the NYSE is to match buyers with sellers.

You contacted your stock broker this morning and placed an order to sell 300 shares of a stock that trades on the NYSE. This sale will occur in the:

secondary market.

Levi had an unexpected surprise when he returned home this morning. He found that a chemical spill from a local manufacturer had spilled over onto his property. The potential claim that he has against this manufacturer is that of a(n):

stakeholder

An agency issue is most apt to develop when:

the control of a firm is separated from the firm's ownership.