1) Capital expenditure is:

A. the extra capital paid in by the proprietor

B. money spent on selling fixed assets

C. money spent on buying fixed assets or adding value to them

2) The primary goal of financial manager is _______.

A. minimizing return

B. maximizing the business owner's wealth

C. Minimizing risk

D. maximizing profit

D. the cost of running the business on a day-to-day basis

3) What is the expected return on asset M, if the expected market return is 20%, its beta is 1.7, and the risk-free rate is 5%?

A. 30.5%

B. 7.5%

C. 5.0%

D. 15.0%

4) The purpose of adding an asset with a negative or low positive beta to a portfolio is to______

A. reduce profit

B. reduce risk

C. increase profit

D. increase risk

5) The accounts for Heat pic for the year 31 December 2019 include the following, the Receivables collection period are (Vat=0):

Sales $7,200

Gross Profit $2,376

Net profit $1,080

Stocks $300

Trade receivables $624

Cash $1,608

Trade payables $1,890

A. 53 days

B. 32 days

C. 38 days

D. 83 days

6) Which one of the following is incorrect?

A. The statement of financial position and income statement form part of the financial statements of a business

B. The statement of financial position and income statement illustrates the financial position and performance of the business

C. the income statement illustrates the accounting equation

D. The statement of financial position illustrates the accounting equation