1) Which one of the following is a capital budgeting decision? A) Deciding whether or not a new production facility should be built B) Determining how much inventory to keep on hand C) Deciding when to repay a long-term debt D) Deciding how much credit to grant to a particular customer E) Determining how much debt should be borrowed from a particular lender 1) 2) A firm's capital structure refers to the firm's A) combination of accounts appearing on the left side of its balance sheet. B) proportions of financing from current and long-term debt and equity C) combination of cash and cash equivalents. D) investment selections for its excess cash reserves E) mixture of various types of production equipment. 2) 3) The primary goal of financial management is to A) maximize current dividends per share of the existing stock. B) maintain steady growth in both sales and net earnings 3) C) avoid financial distress D) minimize operational costs and maximize firm efficiency E) maximize the current value per share of the existing stock. 4) A conflict of interest between the stockholders and managers of a firm is referred to as 4) e: A) corporate breakdown. B) stockholders' liability C) agency problem D) legal liability E) corporate activism