Principles and Concepts of Financial Management Quiz Test your knowledge of financial management with these questions on ROI, WACC, NPV, ratios, and more. Get ready for your exam or review your understanding of key concepts.
#1
Maximizing profits
Minimizing expenses
Maximizing shareholder wealth
Increasing revenue
#2
Income statement
Balance sheet
Statement of cash flows
Statement of retained earnings
#3
Current ratio
Inventory turnover ratio
Debt to equity ratio
Profit margin ratio
#4
Balance sheet
Income statement
Statement of cash flows
Statement of retained earnings
#5
The percentage of earnings paid out as dividends to shareholders
The change in stock price over a specific period
The ratio of debt to equity in a company's capital structure
The percentage of earnings reinvested into the company
#6
The total capital invested in a business
The capital raised through equity financing
The difference between current assets and current liabilities
The total assets of a company
#7
Higher risk is always associated with higher returns
Higher risk is always associated with lower returns
Higher risk is sometimes associated with higher returns
Higher risk is unrelated to returns
#8
(Net Profit / Total Investment) x 100%
(Net Profit / Total Sales) x 100%
(Net Profit / Total Assets) x 100%
(Net Profit / Equity) x 100%
#9
The ability to convert assets into cash quickly without significant loss
The ability to generate high profits consistently
The ability to maintain stable cash flow
The ability to reduce financial risk
#10
Money has a fixed value over time
Money has different values at different points in time
Money has no value in financial decision-making
Money value increases linearly over time
#11
The company's ability to pay its short-term liabilities with its short-term assets
The company's financial leverage and risk exposure
The company's efficiency in utilizing its assets to generate revenue
The company's profitability compared to its competitors
#12
Budgeting for day-to-day operational expenses
Budgeting for long-term investment decisions
Budgeting for marketing and advertising expenses
Budgeting for employee salaries and benefits
#13
(Cost of Debt + Cost of Equity) / 2
(Cost of Debt x Debt Ratio) + (Cost of Equity x Equity Ratio)
(Cost of Debt x (1 - Tax Rate)) + (Cost of Equity)
(Cost of Debt x Debt Ratio) / (Cost of Equity x Equity Ratio)
#14
Initial Investment / Discount Rate
Present Value of Cash Inflows - Present Value of Cash Outflows
Cash Inflows - Cash Outflows
Future Value - Initial Investment
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