Contemporary Financial Management 10th现代财务管理英文版全套习题.doc

ContentsChapter 1 The Role and Objective of Financial Management1Chapter 2 The Domestic and International Financial Marketplace13Appendix 2A Taxes26Chapter 3 Evaluation of Financial Performance31Chapter 4 Financial Planning and Forecasting51Chapter 5 The Time Value of Money66Appendix 5A Continuous Compounding and Discounting95Chapter 6 Analysis of Risk and Return99Chapter 7 Fixed Income Securities: Characteristics and Valuation127Chapter 8 Common Stock: Characteristics, Valuation, and Issuance153Chapter 9 Capital Budgeting and Cash Flow Analysis179Chapter 10 Capital Budgeting: Decision Criteria and Real Option Considerations202Appendix 10A Mutually Exclusive Investments Having Unequal Lives221Chapter 11 Capital Budgeting and Risk228Chapter 12 The Cost of Capital246Chapter 13 Capital Structure Concepts270Chapter 14 Capital Structure Management in Practice285Chapter 15 Dividend Policy306Chapter 16 Working Capital Policy and Short-Term Financing327Chapter 17 The Management of Cash and Marketable Securities344Chapter 18 Management of Accounts Receivable and Inventories360Chapter 19 Lease and Intermediate-Term Financing376Chapter 20 Financing with Derivatives388Appendix 20B Bond Refunding Analysis404Chapter 21 Risk Management408Chapter 22 International Financial Management415Chapter 23 Corporate Restructuring425Chapter 1The Role and Objective of Financial ManagementMULTIPLE CHOICE1.The primary objective of the firm is:a.Shareholder wealth maximizationb.Social responsibilityc.Long run survivald.Profit maximizationANS: AOBJ:TYPE: FactTOP:A Foundation Concept2.The limitations of the profit maximization goal include:a.It lacks a time dimension (i.e., it is static)b.It fails to consider riskc.The definition of profit is ambiguousd.All the above are limitationsANS: DOBJ:TYPE: FactTOP:Maximization of shareholder wealth: Managerial strategies3.The shareholder wealth maximization goal states that management should seek to maximize the _ of the expected future returns to the owners of the firm.a.Future valueb.Compound valuec.Percentage valued.Present valueANS: DOBJ:TYPE: FactTOP:A Foundation Concept4.Shareholder returns can take the form ofa.Periodic dividend paymentsb.Proceeds from the sale of the stockc.Periodic interest paymentsd.Periodic dividend payments and proceeds from the sale of the stockANS: DOBJ:TYPE: FactTOP:A Foundation Concept5.Shareholder wealth is measured by the _ of the shareholders' common stock holdings.a.Book valueb.Market valuec.Historic valued.Compound valueANS: BOBJ:TYPE: FactTOP:A Foundation Concept6.The objective of maximizing shareholder wealth, as measured by the market value of the firm's stocka.does not consider the timing of the benefits receivedb.provides a way to consider the risk of the returns being offeredc.benefits only certain stockholdersd.neither considers the timing of the benefits received nor benefits only certain stockholdersANS: BOBJ:TYPE: FactTOP:A Foundation Concept7.The two most important disciplines on which financial management relies area.accounting and productionb.accounting and marketingc.economics and marketingd.accounting and economicsANS: DOBJ:TYPE: FactTOP:Financial management and other disciplines8.The most widely accepted objective of the firm is toa.minimize riskb.maximize profitsc.maximize shareholder wealthd.maximize earnings per shareANS: COBJ:TYPE: FactTOP:A Foundation Concept9.The _ the risk of receiving future cash flows, the _ will be the present value of those cash flows.a.greater, greaterb.greater, lowerc.lower, lowerd.lower, greaterANS: BOBJ:TYPE: FactTOP:Risk10.A major advantage of using the maximization of shareholder wealth as the primary goal of the firm is that this goal considersa.the timing and the risk of the expected benefits to be receivedb.the investor's consumption utilityc.the value of closely held partnershipsd.all the aboveANS: AOBJ:TYPE: FactTOP:A Foundation Concept11.The primary reason for the divergence between the shareholder wealth maximization goal and the actual goals pursued by management has been attributed toa.separation of social responsibility and stakeholders' concernsb.separation of ownership and controlc.separation of personal welfare and long-run profit goalsd.the granting of "golden parachute" contractsANS: BOBJ:TYPE: FactTOP:Divergent objectives12.Giving top management _ is one method that ensures managers will act in the interest of shareholders in merger decisions.a."golden parachute" contractsb.excellent payc.executive perksd.job securityANS: AOBJ:TYPE: FactTOP:Divergent objectives13._ arise from the divergent objectives between owners and managers.a.Shareholder relationshipsb.Stakeholder problemsc.Creditor problemsd.Agency problemsANS: DOBJ:TYPE: FactTOP:Agency problems14.Agency costs include all of the following except:a.expenditures to monitor management's actionsb.providing stock as part of management's compensationc.flotation costsd.bonding expendituresANS: COBJ:TYPE: FactTOP:Stockholders and managers15.A potential agency conflict can arise between stockholders and creditors because owners maya.increase the risk of a firm's investmentsb.decrease the amount of debt outstandingc.decrease the risk of a firm's investmentsd.increase the firm's net worthANS: AOBJ:TYPE: FactTOP:Stockholders and creditors16.When KKR acquired RJR Nabisco, the _ in the debt ratio, resulted in a(n) _ in the value of the firm's outstanding bonds.a.decrease, increaseb.increase, increasec.decrease, declined.increase, declineANS: DOBJ:TYPE: FactTOP:Stockholders and creditors17.Agency problems may give rise to costs that _ the market value of firms.a.increaseb.decreasec.do not affectd.are not important toANS: BOBJ:TYPE: FactTOP:Stockholders and managers18.All of the following are problems with the microeconomic profit maximization model except:a.the absence of a time dimensionb.offers financial managers insights to a wide range of problemsc.does not consider the risk of alternative decisionsd.the problem of defining profitsANS: BOBJ:TYPE: FactTOP:Maximization of shareholder wealth: Managerial strategies19._ are largely outside of the direct control of managers.a.investment strategiesb.economic environment factorsc.major policy decisionsd.dividend policiesANS: BOBJ:TYPE: FactTOP:Managerial actions to influence value20.The success of a firm is linked to its stakeholders. This group includes:a.community neighborsb.suppliersc.employeesd.all the aboveANS: DOBJ:TYPE: FactTOP:Social responsibility concerns21.Techniques identified by John Casey that managers could keep in mind when addressing the ethical dimensions of a business problem include all of the following except:a.collect all the facts bearing on the problemb.clarify the parameters of the problemc.involve all parties with a financial interest in the outcomed.seek equity for those who may be affectedANS: COBJ:TYPE: FactTOP:Ethical issues: the practice of financial management22.Many small business owners are _ diversified with respect to their personal wealth.a.poorlyb.highlyc.welld.90%ANS: AOBJ:TYPE: FactTOP:Entrepreneurial finance issues: Shareholder wealth maximizat23._ deals with economic decisions of individuals, households, and firms.a.Economic accountingb.Microeconomicsc.Blue Chip econometricsd.MacroeconomicsANS: BOBJ:TYPE: FactTOP:Economics24.Financial management draws heavily on the following related disciplines:a.accountingb.macroeconomicsc.microeconomicsd.all of the aboveANS: DOBJ:TYPE: FactTOP:Financial management and other disciplines25.The chief financial officer (CFO) normally has responsibility for all the following except:a.advertising strategyb.managing interest rate riskc.trading foreign currenciesd.accounting functionsANS: AOBJ:TYPE: FactTOP:Organization of the financial management function26.The controller normally has responsibility for all _ related activities, while the treasurer is normally concerned with _.a.acquisition, data processingb.tax, cost accountingc.tax, financial accountingd.accounting, expenditure of fundsANS: DOBJ:TYPE: FactTOP:Organization of the financial management function27.According to the shareholder wealth maximization goal, management should seek to maximize the _ of the _ to owners.a.present value; expected pretax cash flowsb.future value; expected pretax cash flowsc.present value; expected future returnsd.future value; expected future returnsANS: COBJ:TYPE: FactTOP:A foundation concept28.Shareholder wealth is measured by the _.a.book value of the shareholders' common stock holdingsb.market value of the shareholders' common stock holdingsc.book value of the company's assetsd.market value of the company's assetsANS: BOBJ:TYPE: FactTOP:Determinants of value29.Among the most important agency relationships in the context of finance is (are) the relationship(s) between _.a.stockholders and creditorsb.management and workersc.stockholders and creditors, and management and workersd.management and creditorsANS: AOBJ:TYPE: FactTOP:Agency problems30.Protective covenants in a company's bond indentures are used in agency relationships involving _.a.stockholders and managersb.stockholders and creditorsc.management and workersd.management and creditorsANS: BOBJ:TYPE: FactTOP:Stockholders and creditors31.The chief financial officer (CFO) of a corporation normally reports to the _ of the company.a.chairman of the board of directorsb.chief operating officerc.controllerd.chief executive officerANS: DOBJ:TYPE: FactTOP:Organization of the financial management function32.The _ has a goal of serving as a bridge between academic study of finance and the application of financial principles by financial managers.a.Financial Executives Instituteb.Financial Management Associationc.American Finance Associationd.Institution of Financial AnalystsANS: BOBJ:TYPE: FactTOP:Professional finance affiliation33.All of the following economic environment factors affect stock prices except:a.investment strategiesb.competitionc.tax ratesd.currency exchange ratesANS: AOBJ:TYPE: FactTOP:Managerial actions to influence value34.The major factors that determine the market value of a company's shares of stock include the _ .a.risk of its cash flowsb.timing of its cash flowsc.book value of its assetsd.risk of its cash flows and the timing of its cash flowsANS: DOBJ:TYPE: FactTOP:Determinants of value35.There is often a divergence between the shareholder wealth maximization goal and the actual goals pursued by management. The primary reason for this is _.a.geographical dispersion of shareholdersb.separation of ownership and controlc.age differences between managers and shareholdersd.that both have their own agendasANS: BOBJ:TYPE: FactTOP:Divergent objectives36.The existence of divergent objectives between owners and managers is one example of a class of problems arising from _.a.social responsibility concernsb.age differences between managers and ownersc.agency relationshipsd.union-management relationsANS: COBJ:TYPE: FactTOP:Agency problems37.The activities of the treasurer include all of the following except:a.financial planningb.tax preparationc.credit analysisd.pension fund managementANS: BOBJ:TYPE: FactTOP:Organization of the financial management function38.The most important managerial objective is to:a.make MC=MRb.maximize profitsc.minimize agency costsd.none of the aboveANS: DOBJ:TYPE: FactTOP:A foundation concept39._ are important because the financial health of a firm depends on the firm being able to generate sufficient cash to pay its creditors, employees, suppliers, and owners.a.cash salesb.cash flowsc.cash profitsd.net profitsANS: BOBJ:TYPE: FactTOP:A foundation concept40.One method of decreasing the cash outflows of a firm is toa.decrease depreciationb.increase capital expendituresc.decrease dividendsd.increase debt repaymentANS: COBJ:TYPE: FactTOP:Cash flow41.If a firm shows an accounting net income, thena.it will not have a cash flow problemb.it will not have a problem obtaining a bank loanc.it will be able to repay all current liabilities on timed.none of the aboveANS: DOBJ:TYPE: FactTOP:Cash flow42.Cash flow concepts are _ but generally accepted accounting principles are _ in the determination of a firm's net income.a.unambiguous, ambiguousb.ambiguous, unambiguousc.ambiguous, also ambiguousd.unambiguous, straightforwardANS: AOBJ:TYPE: FactTOP:Importance of cash flow43.Accounting-based measures of performance include all the following excepta.return on equityb.cash flowc.return on assetsd.market shareANS: BOBJ:TYPE: FactTOP:Cash flows and shareholder wealth44.Accounting-based measures of performance _ subject to short-term manipulation by managers; cash flows _ subject to short-term manipulation.a.are, are notb.are not, arec.are, are alsod.are not, also are notANS: AOBJ:TYPE: FactTOP:Cash flows and shareholder wealth45.The net present value rule provides appropriate guidance for financial decision makers when costs are incurred immediately buta.future cash flows are not known with certaintyb.marginal costs are equal to marginal revenuec.result in a stream of benefits over several future time periodsd.marginal costs are greater then marginal revenueANS: COBJ:TYPE: FactTOP:Net present value rule46.Corporate officers normally include all the following except:a.Secretaryb.Chief operating officerc.Treasurerd.Financial analystANS: DOBJ:TYPE: FactTOP:Corporate organization47.The difference between a