MBA 702 EXAM 1 Latest Update 2025-2026 100
Questions and 100% Verified Correct Answers
Guaranteed A+
cash flow from assets involves what three components - CORRECT ANSWER: 1.
operating cash flow
2. capital spending
3. change in net working capital
if a firm is making financial decisions about future development or possible sale of the
firm, is market value or book value the most useful - CORRECT ANSWER: market value
net working capital is a measure of the firm's what - CORRECT ANSWER: liquidity
net working capital is the difference between what - CORRECT ANSWER: current
assets and current liabilities
what 2 ways do shareholders obtain wealth from the firm - CORRECT ANSWER: 1.
dividends and other direct cash payments
2. appreciation in stock price
what are the 3 important long-term solvency, or leverage, ratios - CORRECT ANSWER:
1. total debt ratio
2. debt to equity ratio
3. equity multiplier
what are the 3 undesirable societal side effects of maximizing shareholder wealth -
CORRECT ANSWER: 1. income inequality
, 2. failure of corporations to take socially responsible actions
3. poorly directed business activities
what are the 5 important types of financial ratios - CORRECT ANSWER: 1. short-term
solvency or liquidity
2. long-term solvency or financial leverage
3. asset management or turnover
4. profitability
5. market value
what are the three categories of financial decisions that the financial manager is
concerned with - CORRECT ANSWER: the size, timing, and riskiness of future cash
flows
what are the three key types of business organizations - CORRECT ANSWER: 1. sole
proprietorship
2. partnership
3. corporations
what financial statement provides a snapshot of a firm's financial position at one point in
time - CORRECT ANSWER: balance sheet
what financial statement provides aggregate data regarding all cash inflows a company
receives from its ongoing operations and external investment sources, as well as all
cash outflows that pay for business activities and investments during a given period -
CORRECT ANSWER: cash flow statements
what financial statement summarizes a firm's revenues and expenses over a given
period of time - CORRECT ANSWER: income statement
Questions and 100% Verified Correct Answers
Guaranteed A+
cash flow from assets involves what three components - CORRECT ANSWER: 1.
operating cash flow
2. capital spending
3. change in net working capital
if a firm is making financial decisions about future development or possible sale of the
firm, is market value or book value the most useful - CORRECT ANSWER: market value
net working capital is a measure of the firm's what - CORRECT ANSWER: liquidity
net working capital is the difference between what - CORRECT ANSWER: current
assets and current liabilities
what 2 ways do shareholders obtain wealth from the firm - CORRECT ANSWER: 1.
dividends and other direct cash payments
2. appreciation in stock price
what are the 3 important long-term solvency, or leverage, ratios - CORRECT ANSWER:
1. total debt ratio
2. debt to equity ratio
3. equity multiplier
what are the 3 undesirable societal side effects of maximizing shareholder wealth -
CORRECT ANSWER: 1. income inequality
, 2. failure of corporations to take socially responsible actions
3. poorly directed business activities
what are the 5 important types of financial ratios - CORRECT ANSWER: 1. short-term
solvency or liquidity
2. long-term solvency or financial leverage
3. asset management or turnover
4. profitability
5. market value
what are the three categories of financial decisions that the financial manager is
concerned with - CORRECT ANSWER: the size, timing, and riskiness of future cash
flows
what are the three key types of business organizations - CORRECT ANSWER: 1. sole
proprietorship
2. partnership
3. corporations
what financial statement provides a snapshot of a firm's financial position at one point in
time - CORRECT ANSWER: balance sheet
what financial statement provides aggregate data regarding all cash inflows a company
receives from its ongoing operations and external investment sources, as well as all
cash outflows that pay for business activities and investments during a given period -
CORRECT ANSWER: cash flow statements
what financial statement summarizes a firm's revenues and expenses over a given
period of time - CORRECT ANSWER: income statement
