Finance Concepts and Perspectives

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What are the main elements that affect the values of future cashflows in finance?

Real investment, financing, taxation, business structures, advantages

Investments, liquidity, working capital, intermediaries, markets

Time, money, information, uncertainty/risk, taxation (correct)

Government, corporate finance, shareholders, debt capital, gilts

Which perspective in finance involves real investment, capital budgeting, and liquidity/working capital management?

Government

Corporate finance (correct)

Investments

Financial intermediaries and markets

What is a characteristic of a PLC (Public Limited Company) in terms of shareholder liability?

Unlimited liability, liable for all company debts

Variable liability, dependent on annual profits

Shared liability, liable based on ownership percentage

Limited liability, the most they can lose is the money they invested (correct)

What is a disadvantage of unincorporated business structures like sole traders and partnerships?

Difficult to sell, ownership and control concentrated Signup and view all the answers

Which element is characteristic of debt capital in a company's financing?

Money borrowed for fixed period Signup and view all the answers

What is the primary purpose of a stock exchange's secondary market?

To provide correct valuations and fair prices for existing shares Signup and view all the answers

What is the main advantage of a company issuing new shares in the primary market through an IPO?

Ability to raise new equity finance for the company Signup and view all the answers

Why do some investors sell shares in the secondary market based on information motivation?

Because they believe the company is not performing well currently Signup and view all the answers

What is a major disadvantage of establishing a corporation in terms of tax implications?

Double taxation due to corporation taxes and dividends tax Signup and view all the answers

In the context of financial intermediaries and markets, what is the primary function of money and capital markets?

To facilitate the exchange of financial securities among investors Signup and view all the answers

Finance Concepts and Perspectives

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Questions and Answers

What are the main elements that affect the values of future cashflows in finance?

Which perspective in finance involves real investment, capital budgeting, and liquidity/working capital management?

What is a characteristic of a PLC (Public Limited Company) in terms of shareholder liability?

What is a disadvantage of unincorporated business structures like sole traders and partnerships?

Which element is characteristic of debt capital in a company's financing?

What is the primary purpose of a stock exchange's secondary market?

What is the main advantage of a company issuing new shares in the primary market through an IPO?

Why do some investors sell shares in the secondary market based on information motivation?

What is a major disadvantage of establishing a corporation in terms of tax implications?

In the context of financial intermediaries and markets, what is the primary function of money and capital markets?

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