Week 5 Final Exam Study Guide
FIN/370 Final Examination Study Guide
This study guide prepares you for the Final Examination you complete in the last week of the course. It contains practice questions, which are related to each week’s objectives. Highlight the correct response, and then refer to the answer key at the end of this Study Guide to check your answers.
Use each week’s questions as a self-test at the start of a new week to reflect on the previous week’s concepts. When you come across concepts that you are unfamiliar with, refer to the Student Guide for that particular week. The Student Guide provides a breakdown of the readings that align to the Final Examination questions.
Week One: Introduction to Finance and Analysis
Objective: Define basic financial terminology.
1. In terms of organizational costs, which of the following sequences is correct, moving from lowest to highest cost?
a. General partnership, sole proprietorship, limited partnership, corporation
b. Sole proprietorship, general partnership, limited partnership, corporation
c. Corporation, limited partnership, general partnership, sole proprietorship
d. Sole proprietorship, general partnership, corporation, limited partnership
2. The true owners of the corporation are the
a. holders of debt issues of the firm
b. preferred stockholders
c. board of directors of the firm
d. common stockholders
Objective: Explain how financial markets work in the United States.
3. __________ refer to all institutions and procedures that facilitate transactions in long-term financial securities.
a. Currency markets
b. Capital markets
c. Commodity markets
d. Money markets
4. __________ is a method of offering securities to a limited number of investors.
a. Initial public offering
b. Private placement
c. Public offering
d. Syndicated underwriting
5. When public corporations decide to raise cash in the capital markets, what type of financing vehicle is most favored?
a. Retained earnings
b.
This study guide prepares you for the Final Examination you complete in the last week of the course. It contains practice questions, which are related to each week’s objectives. Highlight the correct response, and then refer to the answer key at the end of this Study Guide to check your answers.
Use each week’s questions as a self-test at the start of a new week to reflect on the previous week’s concepts. When you come across concepts that you are unfamiliar with, refer to the Student Guide for that particular week. The Student Guide provides a breakdown of the readings that align to the Final Examination questions.
Week One: Introduction to Finance and Analysis
Objective: Define basic financial terminology.
1. In terms of organizational costs, which of the following sequences is correct, moving from lowest to highest cost?
a. General partnership, sole proprietorship, limited partnership, corporation
b. Sole proprietorship, general partnership, limited partnership, corporation
c. Corporation, limited partnership, general partnership, sole proprietorship
d. Sole proprietorship, general partnership, corporation, limited partnership
2. The true owners of the corporation are the
a. holders of debt issues of the firm
b. preferred stockholders
c. board of directors of the firm
d. common stockholders
Objective: Explain how financial markets work in the United States.
3. __________ refer to all institutions and procedures that facilitate transactions in long-term financial securities.
a. Currency markets
b. Capital markets
c. Commodity markets
d. Money markets
4. __________ is a method of offering securities to a limited number of investors.
a. Initial public offering
b. Private placement
c. Public offering
d. Syndicated underwriting
5. When public corporations decide to raise cash in the capital markets, what type of financing vehicle is most favored?
a. Retained earnings
b.