Peregrine Finance Exam Questions with
correct Answers 2025/2026 A+ Graded
100% Verified
The firms are primarily interested in ratios that measure the short-term liquidity of the company
and its ability to make principal and interest payments. - ANS-Creditors
A company's balance sheet shows the value of assets, liabilities, and stockholders' equity -
ANS-At a specific point in time
A firm that employs an aggressive strategy to finance assets - ANS-Will finance a portion of
long-term (permanent) growth in assets with short-term financing
Which of the following is NOT an example of a financial asset? - ANS-Property, plant, and
equipment
Which of the following statements is correct? - ANS-The incremental operating cash flow for
capital budgeting includes return on invested capital, which is net income, and return of part of
invested capital, which is depreciation
The bottom-up method for forecasting sales - ANS-Relies on the ability of sales personnel to
assess future demand, usually without the aid of statistical models
A(n) ________ is generally obtained from a bank or insurance company and the borrower
agrees to make a series of payments consisting of interest and principal - ANS-term loan
Which of the following statements is most correct? - ANS-If the maturity risk premium were zero
and the rate of inflation were expected to increase in the future, then the yield curve for U.S.
Treasury securities would, other things held constant, have an upward slope
The premium is compensation for the possibility that the borrower will not be able to pay the
debt's interest and principal on time - ANS-default risk
Your uncle would like to restrict his interest rate risk and his default risk, but he still would like to
invest in corporate bonds. Which of the possible bonds listed below satisfies your uncle's
criteria? - ANS-AAA bond with 5 years to maturity
correct Answers 2025/2026 A+ Graded
100% Verified
The firms are primarily interested in ratios that measure the short-term liquidity of the company
and its ability to make principal and interest payments. - ANS-Creditors
A company's balance sheet shows the value of assets, liabilities, and stockholders' equity -
ANS-At a specific point in time
A firm that employs an aggressive strategy to finance assets - ANS-Will finance a portion of
long-term (permanent) growth in assets with short-term financing
Which of the following is NOT an example of a financial asset? - ANS-Property, plant, and
equipment
Which of the following statements is correct? - ANS-The incremental operating cash flow for
capital budgeting includes return on invested capital, which is net income, and return of part of
invested capital, which is depreciation
The bottom-up method for forecasting sales - ANS-Relies on the ability of sales personnel to
assess future demand, usually without the aid of statistical models
A(n) ________ is generally obtained from a bank or insurance company and the borrower
agrees to make a series of payments consisting of interest and principal - ANS-term loan
Which of the following statements is most correct? - ANS-If the maturity risk premium were zero
and the rate of inflation were expected to increase in the future, then the yield curve for U.S.
Treasury securities would, other things held constant, have an upward slope
The premium is compensation for the possibility that the borrower will not be able to pay the
debt's interest and principal on time - ANS-default risk
Your uncle would like to restrict his interest rate risk and his default risk, but he still would like to
invest in corporate bonds. Which of the possible bonds listed below satisfies your uncle's
criteria? - ANS-AAA bond with 5 years to maturity
