fin2603-assignment-one-preparation-questions.
1. One method often used by companies to ensure that management decisions are in the
best interest of the shareholders is to ...
A. have a shareholder meeting once a year.
B. threaten to fire managers who do not performing adequately.
C. tie manage...
1. One method often used by companies to ensure that management decisions are in the
best interest of the shareholders is to ...
A. have a shareholder meeting once a year.
B. threaten to fire managers who do not performing adequately.
C. tie management compensation to the performance of the company share price
D. tie management compensation to the level of earnings per share.
2. The long-term financial goal of the firm may be achieved by ..
A. maximising revenue and minimising expenses
B. minimising the cost of capital and maximising the internal rate of return (IRR).
C. maximising the assets relative to the liabilities
D. accelerating cash inflows
3.Which of the following is not a responsibility of the treasurer of an organisation?
A. Raising the necessary funds for the organisation in order to be sustainable and
grow.
B. Doing the tax payments for the organisation
C. Conducting and executing capital budgeting activities
D. Formulating and the credit policy of the organisation
4. The best way in which a firm may improve its profitability would involve ..
A. reducing expenditure on non-core business activities.
B. employing fewer permanent staff and using contract workers during peak periods
C. increasing sales by means of improved marketing
D. selling all its non-core assets
5. What is the main function of a financial manager?
A. To prevent bad debts.
B. To ensure liquidity and solvency.
C. To increase the value of ordinary shares.
D. To earn returns greater than those of the competitors.
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