PLEASE ANSWER THE QUESTIONS BELOW

Question 1. "Shareholder wealth" in a firm is represented by:

a) the number of people employed in the firm

b) the book value of the firm's assets less the book value of its liabilities

c) the amount of salary paid to its employees.

d) the market price per share of the firm's common stock.

Question 2 The long-run objective of financial management is to:

a) maximize earnings per share.

b) maximize the value of the firm's common stock.

c) maximize return on investment

d) maximize market share.

3. What are the earnings per share (EPS) for a company that earned RM. 100,000 last year in after-tax profits, has 200,000 common shares outstanding and RM. 1.2 million in retained earning at the year end?

a) RM100,000

b) RM 6.00

c) RM 0.50

d) RM 6.50

4. A(n) ................. would be an example of a principal, while a(n)................. would be an example of an agent.

a) shareholder; manager

b) manager; owner

c) accountant; bondholder

d) shareholder; bondholder

5. The market price of a share of common stock is determined by:

a) the board of directors of the firm.

b) the stock exchange on which the stock is listed. Option 2

c) the president of the company

d) individuals buying and selling the stock.

Option 5

6. ____________________ and __________________________ are the two versions of goals of the financial management of the firm.

a) Profit maximisation, Wealth maximization

b) Production maximisation, Sales maximisation

c) Sales maximisation, Profit maximization

d) Value maximisation, Wealth maximisation

7. Which stakeholders have the highest motivation to take risky but value-enhancing investments for the firm?

A. Suppliers

B. Creditors

C. Shareholders

D. A salaried CEO

8. All the following functions are the five basic corporate finance functions except:

A. External financing function

B. Capital budgeting function

C. Risk management

D. Auditing

9. The decision function of financial management can be broken down into the capital budgeting, cash management, and credit management

A. decisions.financing and investmentinvestment,

B. financing, and asset management

C. financing and dividend

D. capital budgeting, cash management, and credit management

10. Which of the following enjoys limited liability?

A. A general partnership.

B. A corporation.

C. A sole proprietorship.

D. None of the above.

11. Michael Cohn is a "member" (a type of owner) of a marine supply business. Michael's business is

A. a sole proprietorship

B. a corporation.

C. a limited liability company.

D. a general partnership.

12. A corporation in which you are a shareholder has just gone bankrupt. Its liabilities are far in excess of its assets. You will be called on to pay:

A. a proportionate share of bondholder claims based on the number of common shares that you own

B. a proportional share of all creditor claims based on the number of common shares that you own

C. an amount that could, at most, equal what you originally paid for the shares of common stock in the corporation

D. Nothing

Option 3

13 A 30-year bond issued by Geloma Bhd in 2007 would now trade in the

A. primary money market.

B. secondary money market.

C. primary capital market.

D. secondary capital market.

14. Money market mutual funds

A. enable individuals and small businesses to invest indirectly in money-market instruments.

B. are available only to high net-worth individuals.

C. are involved in acquiring and placing mortgages.

D. are also known as finance companies.