Which of the following is an advantage of a sole proprietorship?
Question options:
  

The owner’s unlimited liability
 

The lack of continuity upon death   of the owner
 

The ease of start-up
 

The ability to raise capital
 
Question 2

5 / 5 points
       
Stocks are bought and sold in __________ markets.
Question options:
  

equity
 

debt
 

derivatives
 

foreign exchange
 
Question 3

5 / 5 points
       
The common objective of borrowing and lending is to:
Question options:
  

make all parties better off.
 

gain a profit at the other’s   expense.
 

make a firm or individual appear   more liquid than is really the case.
 

thwart regulatory authority.
 
Question 4

5 / 5 points
       
__________ are the forums where buyers and sellers of financial assets and commodities meet.
Question options:
  

Housing markets
 

Federal Reserve banks
 

Financial markets
 

Automotive shows
 
Question 5

5 / 5 points
       
Financial assets that will mature within a year are bought and sold in the __________ market.
Question options:
  

debt
 

capital
 

stock
 

money
 
Question 6

5 / 5 points
       
The set of financial activities that support the OPERATIONS of a business is best described by which main area of finance?
Question options:
  

Corporate finance
 

Investments
 

Financial institutions and markets
 

International finance
 
Question 7

5 / 5 points
       
At its most basic level, the function of financial intermediaries is to:
Question options:
  

track and report interest rates.
 

move money from lenders to   borrowers and back again.
 

report all financial transactions   to the federal government.
 

effect a transfer of wealth in   society.
 
Question 8

5 / 5 points
       
__________ addresses the question of how to handle our day-to-day business needs.
Question options:
  

Capital budgeting
 

Capital structure
 

Working capital management
 

Accounts receivable management
 
Question 9

5 / 5 points
       
__________ is a major disadvantage of the corporate form of business.
Question options:
  

Double taxation
 

Unlimited liability
 

Lack of ability to raise capital
 

Transfer of ownership
 
Question 10

5 / 5 points
       
In agency theory, the owners of the business are referred to as __________, and the managers are referred to as __________.
Question options:
  

bondholders, principals
 

stockholders, bondholders
 

agents, principals
 

principals, agents
 
Question 11

5 / 5 points
       
Options are bought and sold in __________ markets.
Question options:
  

equity
 

debt
 

derivatives
 

foreign exchange
 
Question 12

5 / 5 points
       
Of the following, which is NOT one of the four main areas of finance?
Question options:
  

International Finance
 

Corporate Finance
 

Investments
 

All are considered main areas of   finance.
 
Question 13

5 / 5 points
       
The problem of motivating one party to act in the best interest of another party is known as the:
Question options:
  

leadership directive.
 

management priority.
 

principal-agent problem.
 

sigma six structure.
 
Question 14

5 / 5 points
       
The means by which a company is financed refers to the firm’s ________.
Question options:
  

capital budgeting
 

capital structure
 

accounts receivable management
 

working capital management
 
Question 15

5 / 5 points
       
Currencies are bought and sold in __________ markets.
Question options:
  

equity
 

debt
 

derivatives
 

foreign exchange
 
Question 16

5 / 5 points
       
__________ addresses the question of what business we should be in over the long run.
Question options:
  

Capital budgeting
 

Capital structure
 

Working capital management
 

Accounts receivable management
 
Question 17

5 / 5 points
       
The sale of “new” securities, where the financial asset is being traded for the very first time, is said to take place in the __________ market.
Question options:
  

primary
 

money
 

secondary
 

capital
 
Question 18

5 / 5 points
       
__________ is the area of finance concerned with activities like borrowing funds to finance projects such as plant expansions or new product launches.
Question options:
  

Working capital management
 

International finance
 

Investments
 

Corporate finance
 
Question 19

5 / 5 points
       
A __________ is a business that is owned entirely by an individual.
Question options:
  

sole proprietorship
 

partnership
 

subchapter S corporation
 

corporation
 
Question 20

5 / 5 points
       
__________ is the area of finance concerned with the activities of buying and selling financial assets such as stocks and bonds.
Question options:
  

Investments
 

Corporate finance
 

International finance
 

Financial markets and institutions