Corporate Finance Quiz

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Questions and Answers

What does EBITDA represent?

  • A measure of gross profit
  • A measure of net income
  • A measure of gross operating cash flow (correct)
  • A measure of total revenue

Which type of entity typically has limited liability to the amount of capital conferred?

  • Sole proprietorships
  • Partnerships
  • Limited liability companies
  • Corporations (correct)

In which type of entity does a firm's life terminate with the death of major founder(s)?

  • Sole proprietorship
  • Limited liability company (LLC)
  • Corporation
  • Proprietorship and limited partnership (correct)

What types of cash flows can the Net Present Value (NPV) be computed for?

<p>All types of cash flows (A)</p> Signup and view all the answers

Flashcards

What Does EBITDA Represent?

A measure of gross operating cash flow, representing earnings before interest, taxes, depreciation, and amortization.

Entity with Limited Liability?

An entity where liability is limited to the amount of capital invested.

Entity Terminating with Founder's Death?

A firm's life ends with the death of the major founder(s).

Cash Flows for NPV?

The Net Present Value (NPV) can be computed for all types of cash flows.

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