fundamentals of corporate finance 11th canadian edition By Stephen A. Ross Test bank
B) The process of planning and managing a firm's long-term investments.
C) A venue where long-term debt and equity securities are bought and sold.
D) How a firm is financed through different proportions of debt and equity.
E) A venue where buyers and sellers of capital equipment come together to trade such assets.
43) The best definition of capital markets is:
A) The possibility of conflicts between shareholders and management in a large corporation.
B) The process of planning and managing a firm's long-term investments.
C) A venue where long-term debt and equity securities are bought and sold.
D) The purchase or sale of securities whose value derives from the price of another, underlying, asset.
E) A venue where buyers and sellers of capital equipment come together to trade such assets.
44) Which of the following accounts does not relate to working capital management decisions?
A) Accounts payable.
B) Issuing long-term debt.
C) Accounts receivable.
D) Inventory.
E) Short-term debt.
45) The decision related to choosing the mixture of debt and equity used by the firm to finance its operations is called:
A) Working capital management.
B) Financial depreciation.
C) Agency cost analysis.
D) Capital budgeting.
E) Capital structure.
46) The process of planning and managing a firm's long-term investments is called:
A) Working capital management.
B) Financial depreciation.
C) Agency cost analysis.
D) Capital budgeting.
E) Capital structure.
47) The management of the firm's short-term assets and liabilities is called:
A) Working capital management.
B) Financial depreciation.
C) Agency cost analysis.
D) Capital budgeting.
E) Capital structure.
48) In corporate agency theory, managers are _______, and owners are _______.
A) Bondholders, shareholder.
B) Shareholder, bondholders.
C) Agents, principals.
D) Principals, agents.
E) Agents, contractors.
49) Which one of the following actions by a financial manager creates an agency problem?
A) Refusing to borrow money when doing so will create losses for the firm.
B) Refusing to lower selling prices if doing so will reduce the net profits.