Question

WILL FAN & MEDAL <3

1. __________ is the use of common stock and/or retained earnings to raise long-term funding.
A) Equity financing
B) Leverage
C) Debt financing
D) Indenture

2. The principle that safer investments tend to offer lower returns while riskier investments tend to offer higher returns is called
A) the risky principle
B) cash flow decision
C) risk-return relationship
D) the safety factor

3. _________ is long-term borrowing from sources outside of the company.
A) Leverage
B) Outside borrowing
C) Equity financing
D) Debt financing

Answer 1

4. Which of the following best describes health insurance?
A) insurance underwritten for a group as a whole rather than each individual in it
B) insurance covering losses resulting from physical damage to or loss of the insured's real estate or personal property
C) coverage provided by a firm to employees for medical expenses, loss of wages, and rehabilitation costs resulting from job-related injuries or disease
D) insurance covering losses resulting from medical and hospital expenses as well as income from injury or disease

5. ________ insurance covers losses resulting from damage to people or property when the insured party is judged responsible.
A) Liability
B) Key-person
C) Health
D) Disability

6. ________ is a short-term security, or note, containing a borrower's promise to pay.
A) A trade draft
B) Equity financing
C) Commercial paper
D) Leverage

7. The three general categories of responsibilties of the financial manager are
A) cash-flow management, financial control, and financial planning
B) financial planning, accounting, and government tax reporting
C) government tax reporting, cash-flow manangement, and financial control
D) accounting, cash-flow management, and government tax reporting

8. How may a company transfer to another firm?
A) insurance
B) risk avoidance
C) risk control
D) investing

9. __________ are the major source of long-term debt financing for most corportations.
A) Loans
B) Common stock
C) Commercial paper
D) Bonds

10. The first step in a risk management program is to
A) measure the frequency and severity of potential losses
B) monitor the results of the program
C) identify the risks and potential losses
D) evauate the alternatives