财务管理基础考试题.doc

此文档收集于网络，如有侵权，请联系网站删除Examination for Fundamentals of Financial ManagementI. Paraphrase the following terms. (5 questions, 4 points each, 20 points total)1. Financial management2. Future value3. Preferred stock4. Internal rate of return (IRR)5. Break-even analysisII. Please find the best answers to the following questions. (8questions, 2points each, 16 points total)1.The financial goal of a corporation is to: ( )A. Maximize sales B. Maximize profits C. Maximize the value of the firm for the shareholders D.Maximize managers benefits 2. A major disadvantage of the corporate form of organization is the ( )A. double taxation of dividendsB.inability of the firm to raise large sums of additional capitalC. limited liability of shareholdersD. limited life of the corporate form. 3. Interest paid (earned) on both the original principal borrowed (lent) and previous interest earned is often referred to as ( ).A. present value B. simple interest C. future value D. compound interest4. Which of the following items is the function of a treasurer? ( )A. cost accounting B. internal control C. capital budgeting D. general ledger5. Which of the following items has the most risk? ( )A. treasury bill B. corporate bond C. preferred stock D. common stock6. Assume that dividends of a common stock will be maintained at D forever, and the required return of the stockholder is r, the par value of the stock is m, the value of the stock is ( )A. m B. m+D C. m+D/r D. D/r7. The project is accepted when ( )A. its payback period is more than some maximum acceptable payback periodB. its net present value is zero or moreC. its profitability index is less than 1.00D. its internal rate of return is less than required rate of return8. A company can improve (lower) its debt-to-total asset ratio by doing which of the following?A. Borrow more. B. Shift short-term to long-term debt. C. Shift long-term to short-term debt. D. isssue common stock.III. Statement judgement (5questions, 2points each, 10 points total)1. Until around the first half of the 1900s, financial managers primarily raised funds and managed their firms cash positions. ( )2. Discount Rate is the interest rate used to convert present values to future values. ( )3. In a sole proprietorship, the owner is personally responsible for all financial obligations of the firm. ( )4. The market price of a particular bond is much greater today than it was yesterday. The calculated yield to maturity (YTM) based on todays market price would, therefore, be greater than the calculated YTM based on yesterdays market price. ( )5. Simple interest is interest that is paid on only the original amount borrowed (lent) ( )IV. Questions. (4 questions, 6 points each, 24 points total)1. Describe the four basic forms of business organization in the United States.2. Distinguish between an “ordinary annuity” and an “annuity due”.3. Discuss the different types of investor attitudes toward risk.4. Describe four methods of project valuation and selection used in capital budgeting. Calculation questions. (3 questions, the fist one 7points, the second one 8 points, the third one 15points, 30 points total)1. You need to have $100000 at the end of 10 years. To accumulate this sum, you have decided to save a certain amount at the end of each next 10 years and deposit it in the bank. The bank pays 8% interest compounded annually for long-term deposit. How much will you have to save each year? (PVIF(8%,10)=0.463, PVIFA(8%,10)=0.671, FVIF(8%,10)=2.159, FVIFA(8%,10)=14.487) 2. What market yield is implied by a share of common stock currently selling for $40 whose dividends are expected to grow at a rate of 9 percent per year and whose dividend next year is expected to be $2.40?3. Stallings Specialty Paint Company has fixed operating costs of $3 million a year. Variable operating costs are $1.75 per half pint of paint produced, and the average selling price is $2 per half pint.(1) What is the annual operating break-even point in half pints (QBE)？In dollars of sales(SBE)？(2) If variable operates decline to $1.68 per half pint, what would happen to the operating break-even point (QBE)?(3) If fixed costs increase to $3.75 million per year, what would be the effect on the operating break-even point (QBE)?(4) Compute the degree of operating leverage (DOL) at the current sales level of 16 million