Mcqb8

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School
Greenwich English College **We aren't endorsed by this school
Course
BUSINESS 123
Subject
Finance
Date
Nov 16, 2023
Pages
3
Uploaded by SargentRiverPolarBear33 on coursehero.com
61. Question: What does the term "Cash Conversion Cycle" measure in working capital management? A. The time it takes to convert investments into cash B. The time it takes to sell inventory and collect receivables C. The time it takes to pay off long-term debt D. The time it takes to negotiate supplier contracts Answer: B. The time it takes to sell inventory and collect receivables 62. Question: In finance, what is the primary purpose of a Futures Contract? A. To buy or sell an asset at a predetermined price in the future B. To invest in mutual funds C. To issue debt securities D. To manage current cash flow Answer: A. To buy or sell an asset at a predetermined price in the future 63. Question: Which financial metric measures the efficiency of a company in managing its short-term liquidity? A. Current Ratio B. Debt-to-Equity Ratio C. Earnings Per Share (EPS) D. Quick Ratio Answer: D. Quick Ratio 64. Question: What is the purpose of the Capital Asset Pricing Model (CAPM) in finance? A. To assess the company's profitability B. To determine the cost of debt C. To calculate the required rate of return for investments D. To evaluate the company's risk level Answer: C. To calculate the required rate of return for investments 65. Question: In financial markets, what does the term "Arbitrage" refer to? A. The buying and selling of securities to profit from market inefficiencies B. Investing in low-risk assets C. Issuing new shares to the public D. Speculating on future market movements Answer: A. The buying and selling of securities to profit from market inefficiencies 66. Question: What is the primary purpose of a financial audit? A. To assess employee performance B. To evaluate marketing strategies
C. To verify the accuracy of financial statements D. To determine the company's market share Answer: C. To verify the accuracy of financial statements 67. Question: Which financial ratio measures a company's ability to cover its interest expenses with its operating income? A. Debt-to-Equity Ratio B. Interest Coverage Ratio C. Quick Ratio D. Asset Turnover Ratio Answer: B. Interest Coverage Ratio 68. Question: What is the primary goal of a company's treasury management function? A. Maximizing shareholder value B. Minimizing taxes C. Managing the company's liquidity and financial risk D. Reducing operating expenses Answer: C. Managing the company's liquidity and financial risk 69. Question: What does the term "Financial Derivatives" encompass? A. Physical assets like real estate B. Financial instruments whose value derives from an underlying asset C. Long-term investment projects D. Currency exchange rates Answer: B. Financial instruments whose value derives from an underlying asset 70. Question: In financial markets, what does the term "Bear Market" refer to? A. A market characterized by falling prices B. A market with high trading volumes C. A market dominated by bullish investors D. A market with low volatility Answer: A. A market characterized by falling prices 71. Question: What is the primary purpose of a Private Equity firm? A. To provide loans to small businesses B. To invest in publicly traded stocks C. To invest in private companies and take an active role in their management D. To issue bonds to raise capital Answer: C. To invest in private companies and take an active role in their management
72. Question: Which financial metric measures a company's profitability relative to its shareholders' equity? A. Debt-to-Equity Ratio B. Return on Assets (ROA) C. Return on Equity (ROE) D. Earnings Per Share (EPS) Answer: C. Return on Equity (ROE) 73. Question: What is the primary purpose of the Black-Scholes Model in finance? A. To calculate the value of a company's inventory B. To determine the cost of debt C. To assess a company's financial leverage D. To value options contracts Answer: D. To value options contracts 74. Question: In finance, what is the primary goal of risk-return trade-off? A. Maximizing risk and minimizing return B. Balancing risk and return to achieve optimal results C. Minimizing both risk and return D. Ignoring the relationship between risk and return Answer: B. Balancing risk and return to achieve optimal results 75. Question: What does the term "Leveraged Buyout (LBO)" refer to in finance? A. Buying stocks using borrowed funds B. Acquiring a company using a significant amount of debt C. Selling assets to pay off liabilities D. Investing in low-risk assets Answer: B. Acquiring a company using a significant amount of debt
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