fundamentals of corporate finance 11th canadian edition By Stephen A. Ross Test bank
A) A single individual who desires limited liability for the firm's debts.
B) Two or more individuals who are each totally responsible for the debts of the entity.
C) Multiple individuals, 80 percent of whom enjoy limited liability.
D) Two or more individuals, each of whom has limited liability for the firm's debts.
E) Two or more individuals, only one of whom has unlimited liability for the firm's debts.
137) Which of the following statements concerning NASDAQ is incorrect?
A) NASDAQ is an auction market.
B) Most smaller firms are listed on NASDAQ rather than on the NYSE.
C) NASDAQ is an electronic market.
D) NASDAQ is an OTC market.
E) NASDAQ stands for National Association of Securities Dealers Automated Quotations system.
138) Which one of the following best describes the primary advantage of being a limited partner rather than a general partner?
A) Entitlement to a larger portion of the partnership's income.
B) Ability to manage the day-to-day affairs of the business.
C) No potential financial loss.
D) Greater management responsibility.
E) Liability for firm debts limited to the capital invested.
139) Which one of the following means of management compensation is designed to help eliminate the agency problem?
A) Providing cost of living adjustments.
B) Increasing health care benefits.
C) Offering stock options.
D) Providing annual raises.
E) Providing a corporate jet.
140) On a typical day in Canada, the largest dollar volume of shares are traded _______.
A) Over the counter.
B) On the TSX.
C) On the Venture Exchange.
D) On the NYSE.
E) In primary markets.
141) To avoid the agency problem, managers should take actions:
A) Which adds value to the firm.
B) Only after the president has approved them.
C) Only if they increase the market share of the firm.
D) Which add to the size of the firm's workforce.
E) Only if management jobs will not be jeopardized.
142) When considering a capital budgeting project the financial manager should consider:
A) Only the size of the project.
B) Only the timing of the project cash flows.
C) Only the risk of the project cash flows.
D) Only the size and timing of the project cash flows.