6. Guinness Ghann Limited's investment decision is also called the:

A. Capital budgeting decision B. Working capital decision C. Financing decision D. Liquidity decision

7. The following are advantages of separation of ownership and management of corporations except: A. Facilitate transfer of ownership without affecting the operations of the firm. B. Hire professional managers C. Corporations can exist forever. D. Incur agency costs

8. If a firm uses cash to purchase inventory, its quick ratio will: A. Remain unaffected B. Become zero C. Decrease D. Increase

9. Which of the following is a series of constant cash flows that occur at the end of each period for some fixed number of periods?

A. None of the above B. Ordinary annuity C. Annuity Due D. Perpetuity

10. In how many years, an amount will be doubled at a discount rate of 8 percent? A. 9 years B. 3 years C. Cannot be determined without more information D. 6 years

11. Systematic risk remains present in all portfolios. Some investments will be more sensitive to market factors than others and will therefore have a hicher systematic risk while some are lesser sensitive. The level of systematic risk of assets in a well- diversified portfolio can therefore be measured by...

A. CAPM B. Coefficient of correlation

C. Standard Deviation D. Variance