Which of the following concerning the relationship between risk and return is correct? - Answer-A risk averse investor would prefer a stock with an expected 10% return and a standard deviation of 10% to a stock with an expected return of 10% with a standard deviation of 20%
A company that decide...
FIN 301 Test 1 Quiz Questions and
Answers
Which of the following concerning the relationship between risk and return is correct? -
Answer-A risk averse investor would prefer a stock with an expected 10% return and a
standard deviation of 10% to a stock with an expected return of 10% with a standard
deviation of 20%
A company that decides to invest to expand its factory for a new product line is an
example of which of the following corporate financial decisions: - Answer-Capital
Budgeting
Which of the following is part of the controller's function? - Answer-Preparing financial
statements and reports
Which of the following is part of the treasurer's function? - Answer-Working capital
management
Determining the feasibility of various projects
Financial planning
Managing short and long term capital requirements
According to the Theory of Efficient Capital Markets: - Answer-Stock prices react
instantaneously to new information
Given the following information, a rational investor would most likely invest in which
stock? Stock A: Mean Return - 15%; Standard Deviation - 10%
Stock B: Mean Return - 15%; Standard Deviation - 14% - Answer-Stock A because it is
not as risky as Stock B
Which of the following statements about Business Organizational Forms is true -
Answer-Owners of corporations have limited liability
The time value of money implies that: - Answer-A dollar today is worth MORE than a
dollar tomorrow
Which of the following is one of the three primary areas of finance - Answer-Institutions
& Markets
Traditionally, which of the following are responsibilities of the controller side of a
corporate finance organization - Answer-Financial Statements, Financial Systems and
Taxes
Which of the following is a principle held by Gordon Gekko - Answer-Management must
be accountable to the shareholders
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