Quiz Module 1 ?s

Question 1

Which answer gives a definition of finance?

Recording of all the financial transactions of the company

The study of fund management and asset allocation over time

A means for evaluating the time value of money

The process of evaluating financial risk

Answer 1

The study of fund management and asset allocation over time

Question 2

Which answer best summarizes how the fields of accounting, finance, and economics relate to each other?

Finance is backwards looking, economics projects forward, and accounting studies cause and effect.

Accounting is backwards looking, finance projects forward, and economics studies cause and effect.

Economics is backwards looking, finance projects forward, and accounting studies cause and effect.

Finance is backwards looking, economics projects forward, and accounting studies cause and effect.

Answer 2

Accounting is backwards looking, finance projects forward, and economics studies cause and effect.

Question 3

Which concept describes the underlying driver behind all finance?

Risk

Fund management and asset allocation

Time

Profit

Answer 3

Time

Question 4

Which answer does not represent how finance is used in organizations?

To maximize shareholder value

To ensure that money is at the right place at the right time

To maximize short-term profit

To choose between different potential investments

Answer 4

To maximize short-term profit

Question 5

Which factor is not something a corporation must consider when making an investment decision?

Whether the investment is too risky for the corporation and its shareholders

Whether the investment can be financed appropriately

Whether the investment maximizes the value of the firm

Whether you can accurately calculate the guaranteed return on the investment

Answer 5

Whether you can accurately calculate the guaranteed return on the investment