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Exam 17: Financial Management Appendix C Managing Risk

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Question 91

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Venture capital is money that is invested in new or emerging companies that are perceived as having great profit potential.

A) True
B) False

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Question 92

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The capital budget is the most detailed and most used budget a firm prepares.

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B) False

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Question 93

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In large corporations,the board of directors is normally involved in decisions regarding long-term financing.

Corporations that issue debenture bonds are required to provide collateral.

are assets that are often pledged by businesses as collateral for a loan.

The costs to a retailer of accepting credit cards are generally greater than the benefits provided.

Finance is most closely related to:

Acquiring sufficient funds to meet the operational needs of an organization represents a responsibility of financial management.

What is financial management? Identify the duties and responsibilities of financial managers.

A cash flow forecast provides managers with an estimate of the profit potential of different strategic plans.

Acquiring funds through borrowing represents:

Financial managers are responsible for controlling cash flows.

Inadequate control of expenses represents a common financial problem that contributes to business failures.

A budget reflects management's expectations for revenues and required resources.

Money has a time value because:

Sarah intends to major in finance and find employment in corporate financial management.As a finance major,Sarah will discover her ______courses to be similar to her finance classes.

A firm negotiates a(n) ______with its bank so the firm will have access to a specified amount of unsecured short-term funds,provided the bank has the funds available.

The first step in financial planning is to develop a budget to better control costs.

Investors and entrepreneurs should have an understanding of financial issues.

Capital expenditures are major investments in long-term assets such as equipment,and trademarks.