(ZONDERVAN) Questions with
Correct Answers
What are the four areas of finance? - Correct Answers: Corporate, investments, financial institutions,
international finance
Sole Proprietorship - Correct Answers: a business owned and managed by a single individual
Partnership - Correct Answers: A business in which two or more persons combine their assets and skills
limited partnership - Correct Answers: form of partnership where one or more partners are not active in
the daily running of the business, and whose liability for the partnership's debt is restricted to the
amount invested in the business
finance - Correct Answers: management of money
Corporation - Correct Answers: a company or group of people authorized to act as a single entity (legally
a person) and recognized as such in law.
disadvantages of corporation - Correct Answers: double taxation
LLC (Limited Liability Company) - Correct Answers: Corporation with the benefits of a sole
proprietorship, and not many disadvantages.
3 decisions financial managers face - Correct Answers: capital budgeting, capital structure, working
capital management
General Goal of Financial Management - Correct Answers: maximize the market value of the existing
owners' equity