ADMS 1010 FINAL EXAM QUESTIONS AND ANSWERS
What is a Causal Claim - Answers - Certain events or factors (causes) are responsible
for bringing about other events or situations (effects)
Why is it important to understand causal claim - Answers - Basis for decision making,
reasoned action based on predictions
Why can causal reasoning be very difficult - Answers - Business situations are
characterized by complexity and uncertainty
Every effect may have multiple or rival causes
How to establish causal claims - Answers - Conduct experiments with randomly
assignment samples
What are Rival Causes - Answers - Differences between groups
two variables are correlated,
one event follows another event
Differences between groups - Answers - ex. Cause: University Program, Effect: Better
Job Offers
Alt explanations: Different admission standards, different locations = different student
opportunities
Must ask: Are there any other differences that may be relevant?
When two variables are correlated - Answers - Direct causation: Cause = Effect
Reverse Causation: Effect = Cause
Third Factor: Cause Apparent & Cause True = Effect
When one event follows another event - Answers - Post hoc propter hoc fallacy
One event following another does not mean the first caused the second, basis of many
superstitious beliefs
Assests - Answers - Recording items which are useful/receivable to the organization
Liabilities - Answers - Recording items which the organization owes to others
Trading/Profit-Loss/Income-Expense - Answers - Recording items which are operational
in nature
ex. Credit increases in income ... Debit decreases in income/increases in expenses
Financial Statements - Answers - Balance Sheet, Income Statement, Cash Flow
Statement
Balance Sheet - Answers - Statement of financial position at a given point in time
, Income Statement - Answers - Statement of income, expenses, and profits over a given
period
Cash Flow Statement - Answers - Reports on cash flow activities, particularly operating,
investing, financing activites
Main Roles of Accountants - Answers - Financial Accounting, Management Accounting,
Auditing, Tax
Financial Accounting - Answers - Summary, analysis and reporting of financial
transactions
Management Accounting - Answers - Use of accounting information to make better
management decisions
Auditing - Answers - Independent examination of an organization's accounts
What is the essence of finance - Answers - Time TRavel
Saving is about... - Answers - moving resources from the present into the future
Financing is about - Answers - moving resources from the future, back into the present
Intermediary - Answers - A person who acts as a link between people in order to
mediate
Public Finances - Answers - Addresses the role of government in economy
Corporate Finance - Answers - Funding and capital structure of corporations,
investment banking
Personal Finance - Answers - Financial management for individuals and families
What is the Financial System - Answers - Flows money
Countries/Corporation/Individuals with surplus money →
Finance/Financial System → Entities with Deficit
What is Money - Answers - A share perception of value, a belief system.
If we stop believing in money, it loses its value
The financial system is unstable.
Value Creation - Answers - The ways that different types of resources (human, physical
and intangible) are established and interact to produce new goods and services
What is a Causal Claim - Answers - Certain events or factors (causes) are responsible
for bringing about other events or situations (effects)
Why is it important to understand causal claim - Answers - Basis for decision making,
reasoned action based on predictions
Why can causal reasoning be very difficult - Answers - Business situations are
characterized by complexity and uncertainty
Every effect may have multiple or rival causes
How to establish causal claims - Answers - Conduct experiments with randomly
assignment samples
What are Rival Causes - Answers - Differences between groups
two variables are correlated,
one event follows another event
Differences between groups - Answers - ex. Cause: University Program, Effect: Better
Job Offers
Alt explanations: Different admission standards, different locations = different student
opportunities
Must ask: Are there any other differences that may be relevant?
When two variables are correlated - Answers - Direct causation: Cause = Effect
Reverse Causation: Effect = Cause
Third Factor: Cause Apparent & Cause True = Effect
When one event follows another event - Answers - Post hoc propter hoc fallacy
One event following another does not mean the first caused the second, basis of many
superstitious beliefs
Assests - Answers - Recording items which are useful/receivable to the organization
Liabilities - Answers - Recording items which the organization owes to others
Trading/Profit-Loss/Income-Expense - Answers - Recording items which are operational
in nature
ex. Credit increases in income ... Debit decreases in income/increases in expenses
Financial Statements - Answers - Balance Sheet, Income Statement, Cash Flow
Statement
Balance Sheet - Answers - Statement of financial position at a given point in time
, Income Statement - Answers - Statement of income, expenses, and profits over a given
period
Cash Flow Statement - Answers - Reports on cash flow activities, particularly operating,
investing, financing activites
Main Roles of Accountants - Answers - Financial Accounting, Management Accounting,
Auditing, Tax
Financial Accounting - Answers - Summary, analysis and reporting of financial
transactions
Management Accounting - Answers - Use of accounting information to make better
management decisions
Auditing - Answers - Independent examination of an organization's accounts
What is the essence of finance - Answers - Time TRavel
Saving is about... - Answers - moving resources from the present into the future
Financing is about - Answers - moving resources from the future, back into the present
Intermediary - Answers - A person who acts as a link between people in order to
mediate
Public Finances - Answers - Addresses the role of government in economy
Corporate Finance - Answers - Funding and capital structure of corporations,
investment banking
Personal Finance - Answers - Financial management for individuals and families
What is the Financial System - Answers - Flows money
Countries/Corporation/Individuals with surplus money →
Finance/Financial System → Entities with Deficit
What is Money - Answers - A share perception of value, a belief system.
If we stop believing in money, it loses its value
The financial system is unstable.
Value Creation - Answers - The ways that different types of resources (human, physical
and intangible) are established and interact to produce new goods and services
