Managerial Finance
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Questions and Answers

Which principle does the financial manager heavily rely on to make financial decisions?

  • Opportunity cost analysis
  • Sunk cost analysis
  • Break-even analysis
  • Marginal cost-benefit analysis (correct)
  • What are the primary activities of the financial manager?

  • Budgeting and forecasting
  • Financial analysis and planning
  • Risk management and compliance
  • Investment decisions and financing decisions (correct)
  • How is the managerial finance function related to economics and accounting?

  • It uses accounting principles to analyze financial data
  • It is unrelated to economics and accounting
  • It relies on economic principles to make financial decisions (correct)
  • It is a subset of economics and accounting
  • Which of the following best describes finance?

    <p>The process of managing money</p> Signup and view all the answers

    What are the legal forms of business organization?

    <p>Sole proprietorship, partnership, and corporation</p> Signup and view all the answers

    What is the goal of a firm in business?

    <p>Maximizing its value</p> Signup and view all the answers

    Why is maximizing the value of the firm an appropriate goal for a business?

    <p>It benefits the shareholders</p> Signup and view all the answers

    What principle does the financial manager heavily rely on to make financial decisions?

    <p>Marginal cost–benefit analysis</p> Signup and view all the answers

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