Financial Decisions and Working Capital Management Quiz

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17 Questions

What type of decisions involve purchasing buildings, acquiring new machinery, or replacing old machinery?

Working capital management decisions

Which financial management activity involves estimating the origins and applications of funds?

Financial planning decisions

What do dividend decisions primarily relate to?

Deciding on dividend payouts

In the context of financial management, what is the main purpose of capital structure decisions?

Deciding on the mix of equity and debt financing

What does working capital management mainly focus on in terms of assets?

Short-term current assets

Which financial activity directly impacts a company's liquidity and profitability?

Working capital management decisions

What is the main function of capital in a business?

To produce products or services

Which of the following is NOT a part of financial management activities?

Selling of products or services

What is the main focus of Investment Decisions for managers?

Deciding on long- and short-term investments

Which of the following is NOT one of the scope areas of financial management?

Capital Allocation Decisions

What is the primary focus of Capital Budgeting?

Committing funds for a long time to fixed assets

Which is a method of capital allocation mentioned in the text?

Indirect Transfers through a Financial Intermediary

What is the main responsibility of financial managers?

Developing and executing financial strategies

Which activity falls under the scope of financial planning?

Preparing the financial plan projecting revenues and expenditures

What is the primary goal of investment decisions made by financial managers?

Invest in projects and securities providing high returns relative to their risks

What is the key objective of financing activities in financial management?

Seeking the best balance between debt and equity financing

Which process involves evaluating and selecting long-term investments that align with a firm's strategic goals?

Capital allocation process

Test your knowledge on financial decisions involving the purchase of assets and working capital management. Learn about the impact of these decisions on a company's financial goals and results.

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