SOLUTION MANUALS
Principles of Finance
s
04/1/22 1
,Principles of Finance
Chapter 1
End-of-Chapter Questions
Introduction to Finance
Multiple Choice Questions
1. Which of the following was NOT identified by your authors as one of the three main areas of
financial study?
A. business finance
B. capital budgeting
C. investments
D. financial markets and institutions
Solution: B
Section 1.1 LO 1 Easy
2. What is the process of determining which long-term or fixed assets to acquire in an effort to
maximize shareholder value?
A. Business finance
B. Capital budgeting
C. Investments
D. Financial markets and institutions
Solution: B
Section 1.1 LO 1 Easy
3. In an organization with each of these financial positions, which title is most likely to be
associated with a job description that is less of a “hands-on” manager and that engages more
in visionary and strategic planning?
A. comptroller (or controller)
B. treasurer
C. vice president of finance
D. chief financial officer (CFO)
Solution: D
Section 1.2 LO 2 Moderate
04/1/22 2
,Principles of Finance
4. Which of the following statements is false?
A. Financial planning is an important tool of for-profit organizations such as corporations
and partnerships but is not important for not-for-profit enterprises such charitable
organizations or governments.
B. Good financial planning considers past, present, and pro forma income statements.
C. Balance sheets are critical elements of the financial planning process and help
demonstrate expected sources and uses of funds.
D. Forecasting in the form of expected sales, cost of funds, and micro- and macroeconomic
conditions are essential elements of financial planning.
Solution: A
Section 1.2 LO 2 Easy
5. Which of the following statements regarding data is generally NOT true?
A. Financial data is important for internal and external analysis of business firms.
B. Outsiders use publicly available data about firms to make investment and regulatory
decisions.
C. “Gut feelings” decision-making tends to be more consistent with value maximization.
D. Suppliers need financial information to determine if they should supply trade credit, and
customers need to know if a firm’s products are reliable and appropriately priced.
Solution: C
Section 1.3 LO 1 Easy
6. Which of the following is generally NOT true about cloud data storage versus on-site data
storage?
A. Cloud data storage provides storage cost advantages.
B. Cloud data storage causes increased energy consumption.
C. Cloud data storage comes with specialized data protection services.
D. Cloud data storage comes with specialized maintenance services.
Solution: B
Section 1.3 LO 3 Moderate
7. Which of the following describes United States Bureau of Labor Statistics (BLS) expectations
of jobs using financial skills in the next decade?
A. plentiful but low paying
B. few and low paying
C. plentiful and high paying
D. few and high paying
Solution: C
Section 1.4 LO 1 Easy
04/1/22 3
,Principles of Finance
8. Which of the following organizations would be unlikely to hire a financial analyst?
A. Government agencies may hire financial analysts to aid in regulatory oversight and
enforcement.
B. Investment companies may hire financial analysts to produce financial reports.
C. Corporations may hire financial analysts to develop financial forecasts.
D. All of the above organizations are likely to hire and develop financial analysts.
Solution: D
Section 1.4 LO 2 Easy
9. The ________ market is the market for ________ securities, and the ________ is the market
for ________ securities.
A. primary; used; secondary; new
B. primary; new; secondary; used
C. secondary; new; primary; new
D. secondary; used; primary; used
Solution: B
Section 1.5 LO 1 Moderate
10. ________ own the securities that they buy or sell; when they engage in a financial
transaction, they are trading from their own portfolio.
A. Dealers
B. Brokers
C. Advisers
D. Comptrollers
Solution: A
Section 1.5 LO 2 Moderate
11. ________ act as facilitators in a market, and they bring together buyers and sellers for a
transaction.
A. Dealers
B. Brokers
C. Advisers
D. Comptrollers
Solution: B
Section 1.5 LO 2 Moderate
04/1/22 4
,Principles of Finance
12. ________ is the study of the allocation of scarce resources, ________ is devoted to the study
of these decisions of allocation by small or individual entities, and ________ examines
decisions taken together or in the aggregate.
A. Macroeconomics; microeconomics; economics
B. Microeconomics; economics; macroeconomics
C. Economics; microeconomics; macroeconomics
D. Economics; macroeconomics; microeconomics
Solution: C
Section 1.6 LO 2 Moderate
13. Which of the following is NOT an economy-wide macroeconomic variable used in macro-
forecasting models?
A. inflation
B. unemployment
C. economic growth
D. CEO turnover
Solution: D
Section 1.6 LO 3 Moderate
14. ________ is the market for short-term, low-risk, highly liquid, homogeneous securities.
A. The capital market
B. The financial market
C. The stock market
D. The money market
Solution: D
Section 1.7 LO 1 Easy
15. ________ are short-term debt instruments issued by the federal government.
A. Treasury bills
B. Treasury notes
C. Treasury bonds
D. Federal Reserve notes
Solution: A
Section 1.7 LO 2 Moderate
04/1/22 5
,Principles of Finance
16. ________ is a short-term, unsecured security issued by corporations and financial institutions
to meet short-term financing needs such as inventory and receivables.
A. A Treasury bill
B. Commercial paper
C. A negotiable certificate of deposit
D. A Treasury note
Solution: B
Section 1.7 LO 2 Easy
17. ________ are US government debt instruments with maturities of 2, 3, 5, 7, or 10 years.
A. Federal funds
B. Federal Reserve notes
C. Treasury notes
D. Treasury bonds
Solution: C
Section 1.7 LO 3 Easy
18. ________ investments tend to have ________ risk and ________ expected returns.
A. Long-term; less; smaller
B. Long-term; greater; greater
C. Short-term; greater; smaller
D. Short-term; less; greater
Solution: B
Section 1.8 LO 1 Moderate
19. ________ value is what a consumer pays for a product. ________ value is what a consumer
is willing to pay for a product.
A. Market; Economic
B. Economic; Market
C. Book; Market
D. Economic; Book
Solution: A
Section 1.8 LO 2 Moderate
04/1/22 6
,Principles of Finance
Review Questions
1. Identify and briefly define the three areas of study in finance.
Solution:
Business finance looks at how managers can apply financial principles to maximize the
value of a firm in a risky environment.
Investments is the study of the products and processes used to create individual and
institutional portfolios with the intent of growing wealth.
Financial markets and institutions is the study of the firms and regulatory agencies that
oversee our financial system.
Section 1.1 LO 1 Moderate
2. Identify the three focal areas in business finance.
Solution:
Working capital management (WCM) is the study and management of short-term assets
and liabilities.
Capital budgeting is the process of determining which long-term or fixed assets to
acquire in an effort to maximize shareholder value.
Capital structure is the process by which managers determine the optimal ways to
finance the firm in general and projects more specifically in an effort to make the firm’s
assets more valuable and increase shareholder wealth.
Section 1.1 LO 1 Difficult
3. Define each of the following types of risk:
inflation risk
diversifiable risk
non-diversifiable risk
political risk
Solution:
Inflation risk occurs when investors have less purchasing power from the realized cash
flows from an investment due to rising prices.
Diversifiable risk, also known as unsystematic risk, occurs when investors hold individual
securities or smallish portfolios and bear risk that a more complete portfolio could
eliminate.
Non-diversifiable risk, or systematic risk, is what remains after portfolio diversification
has eliminated unnecessary diversifiable risk.
Political risk is the risk of local, state, or national governments “changing the rules” and
disrupting firm cash flows.
Section 1.1 LO 3 Difficult
4. Identify three common components of good financial planning.
Solution: Students should identify at least three of the following or similar criteria.
04/1/22 7
,Principles of Finance
Income statements—past, current, and pro forma, or forward looking. The pro forma
income statements should develop likely scenarios and provide sensitivity analysis of
key assumptions.
Cash flow statements are a critical part of any financial planning. Cash flow goes beyond
accounting data and estimates the timing and magnitude of actual cash flows available
to meet financial obligations.
Balance sheets are critical for demonstrating the sources and uses of funds for a firm.
Forecasting in the form of expected sales, cost of funds, and micro- and macroeconomic
conditions are essential elements of financial planning.
Financial analysis including ratio analysis, common-size financial statements, and trend
statements are important aspects of financial planning. Such analysis aids in the
understanding of where a firm has been, how it stacks up against the competition, and
the assessment of target objectives.
Section 1.2 LO 2 Moderate
5. The Concepts in Practice feature in Section 1.3 discusses the importance of data for decision-
making. List at least three of the ways the article suggests managers can use financial
statements.
Solution:
1. Measure the impact of business decisions such as new software, marketing plan, or
product line
2. Aid in the development of budgets by creating a starting point for future expectations
3. Aid in cost cutting or the reduction of duplicate activities
4. Data-supported strategic planning and visioning
5. Consistent data and content across departments
6. Team motivation to set, meet, and exceed goals and objectives
Section 1.3 LO 3 Difficult
6. Describe the role of a financial analyst in a financial institution such as a bank or investment
company.
Solution: The role of financial analyst usually includes market research, financial forecasting,
modeling, cost analysis, and comparative valuations. Financial analysts gather data and produce
financial reports in conjunction with multiple departments within a business or organization. In
a bank, they would provide research analysis to provide support for providing loans. In an
investment firm, they would evaluate the value of potential investments and aid in the
purchase or sale decisions.
Section 1.4 LO 2 Moderate
7. Is a dealer or a broker more likely to be a market maker? In your answer, define the activities
of a market maker.
Solution: A dealer may also be a “market maker.” This means that they own large amounts of a
particular security and stand ready to buy or sell at the current bid or ask price. Market makers
are often brokerage firms who own large amounts of a particular security so they can quickly
04/1/22 8
,Principles of Finance
and efficiently execute trades for their retail and wholesale customers. By standing ready to
always buy or sell, dealers increase the liquidity and efficiency of the market.
Section 1.5 LO 2 Moderate
8. How can an understanding of micro- and macroeconomic factors aid in small business
decision-making?
Solution: Most small-business decisions are on the micro level. This may include decisions to
hire specific individuals, borrow money from local bankers, or expand production for a specific
customer. These decisions, however, are made in a macro environment where the small
business owner understands the national or regional outlook for economic growth, inflation,
and unemployment. For example, the national rate of unemployment may not have been much
help when Bacon Signs was searching for skilled laborers who could form neon signs. However,
the unemployment rate helped inform the company about the probability of demand for new
businesses and the signs they would need.
Section 1.6 LO 2 Difficult
9. We measure market capitalization by multiplying the number of shares of stock outstanding
by the current price per share. Go to finance.yahoo.com and determine the market
capitalization of Nike, Tesla, and Walmart. Which company has the greatest market
capitalization? Which company has the highest level of sales? If these are not the same
companies, why do you think the company with the lower sales level has greater market
capitalization?
Solution: Walmart has the highest sales, but Tesla may have greater value depending on when
the student looks at current market information. Students could argue that because stock
values represent market expectations, Tesla could expect to generate greater sales or a
combination of increased sales and profit margin than Walmart.
Section 1.7 LO 3 Difficult
Chapter 1
Test Bank
Introduction to Finance
These questions and problems can all be solved in a classroom setting using a handheld
financial calculator.
True or False Questions
1. The application of common sense is sufficient for companies to manage their financial
operations.
A. True
B. False
04/1/22 9
, Principles of Finance
Solution: B. Companies are too complex to be managed without extensive knowledge in
multiple areas of finance.
Section 1.1 LO 1 Easy
2. The Financial Industry Regulatory Authority (FINRA) is a US federal institution charged with
enforcement of US financial regulations.
A. True
B. False
Solution: B. FINRA is an independent nongovernmental organization that writes and enforces
the rules governing registered brokers and broker-dealer firms in the United States.
Section 1.1 LO 3 Moderate
3. The key common feature of market brokers and dealers is that they both act as
intermediaries.
A. True
B. False
Solution: A. Both brokers and dealers perform the function of intermediary between buyers and
sellers of securities. The difference is that dealers hold inventories of securities and therefore
stand ready to both buy and sell securities. This is not necessarily true of a broker.
Section 1.5 LO 2 Moderate
4. The term broker refers only to financial firms that buy and sell stock.
A. True
B. False
Solution: B. A broker is an intermediary that brings together the buyer and seller of any type of
asset, including stocks, bonds, real estate, and more.
Section 1.5 LO 2 Difficult
Multiple Choice Questions
1. Business finance looks at how managers apply financial principles to maximize the value of a
firm. Who benefits most when the value of the firm is maximized?
A. Management
B. Employees
C. Shareholders
D. Customers
Solution: C. Any interested party should benefit when a company is successful and increases its
value. However, shareholders “own” the increased value, so they have the most to gain.
Section 1.1 LO 1 Moderate
2. Which of the following areas of finance is a more narrowly focused subfield of one of the
other three areas?
04/1/22 10
Principles of Finance
s
04/1/22 1
,Principles of Finance
Chapter 1
End-of-Chapter Questions
Introduction to Finance
Multiple Choice Questions
1. Which of the following was NOT identified by your authors as one of the three main areas of
financial study?
A. business finance
B. capital budgeting
C. investments
D. financial markets and institutions
Solution: B
Section 1.1 LO 1 Easy
2. What is the process of determining which long-term or fixed assets to acquire in an effort to
maximize shareholder value?
A. Business finance
B. Capital budgeting
C. Investments
D. Financial markets and institutions
Solution: B
Section 1.1 LO 1 Easy
3. In an organization with each of these financial positions, which title is most likely to be
associated with a job description that is less of a “hands-on” manager and that engages more
in visionary and strategic planning?
A. comptroller (or controller)
B. treasurer
C. vice president of finance
D. chief financial officer (CFO)
Solution: D
Section 1.2 LO 2 Moderate
04/1/22 2
,Principles of Finance
4. Which of the following statements is false?
A. Financial planning is an important tool of for-profit organizations such as corporations
and partnerships but is not important for not-for-profit enterprises such charitable
organizations or governments.
B. Good financial planning considers past, present, and pro forma income statements.
C. Balance sheets are critical elements of the financial planning process and help
demonstrate expected sources and uses of funds.
D. Forecasting in the form of expected sales, cost of funds, and micro- and macroeconomic
conditions are essential elements of financial planning.
Solution: A
Section 1.2 LO 2 Easy
5. Which of the following statements regarding data is generally NOT true?
A. Financial data is important for internal and external analysis of business firms.
B. Outsiders use publicly available data about firms to make investment and regulatory
decisions.
C. “Gut feelings” decision-making tends to be more consistent with value maximization.
D. Suppliers need financial information to determine if they should supply trade credit, and
customers need to know if a firm’s products are reliable and appropriately priced.
Solution: C
Section 1.3 LO 1 Easy
6. Which of the following is generally NOT true about cloud data storage versus on-site data
storage?
A. Cloud data storage provides storage cost advantages.
B. Cloud data storage causes increased energy consumption.
C. Cloud data storage comes with specialized data protection services.
D. Cloud data storage comes with specialized maintenance services.
Solution: B
Section 1.3 LO 3 Moderate
7. Which of the following describes United States Bureau of Labor Statistics (BLS) expectations
of jobs using financial skills in the next decade?
A. plentiful but low paying
B. few and low paying
C. plentiful and high paying
D. few and high paying
Solution: C
Section 1.4 LO 1 Easy
04/1/22 3
,Principles of Finance
8. Which of the following organizations would be unlikely to hire a financial analyst?
A. Government agencies may hire financial analysts to aid in regulatory oversight and
enforcement.
B. Investment companies may hire financial analysts to produce financial reports.
C. Corporations may hire financial analysts to develop financial forecasts.
D. All of the above organizations are likely to hire and develop financial analysts.
Solution: D
Section 1.4 LO 2 Easy
9. The ________ market is the market for ________ securities, and the ________ is the market
for ________ securities.
A. primary; used; secondary; new
B. primary; new; secondary; used
C. secondary; new; primary; new
D. secondary; used; primary; used
Solution: B
Section 1.5 LO 1 Moderate
10. ________ own the securities that they buy or sell; when they engage in a financial
transaction, they are trading from their own portfolio.
A. Dealers
B. Brokers
C. Advisers
D. Comptrollers
Solution: A
Section 1.5 LO 2 Moderate
11. ________ act as facilitators in a market, and they bring together buyers and sellers for a
transaction.
A. Dealers
B. Brokers
C. Advisers
D. Comptrollers
Solution: B
Section 1.5 LO 2 Moderate
04/1/22 4
,Principles of Finance
12. ________ is the study of the allocation of scarce resources, ________ is devoted to the study
of these decisions of allocation by small or individual entities, and ________ examines
decisions taken together or in the aggregate.
A. Macroeconomics; microeconomics; economics
B. Microeconomics; economics; macroeconomics
C. Economics; microeconomics; macroeconomics
D. Economics; macroeconomics; microeconomics
Solution: C
Section 1.6 LO 2 Moderate
13. Which of the following is NOT an economy-wide macroeconomic variable used in macro-
forecasting models?
A. inflation
B. unemployment
C. economic growth
D. CEO turnover
Solution: D
Section 1.6 LO 3 Moderate
14. ________ is the market for short-term, low-risk, highly liquid, homogeneous securities.
A. The capital market
B. The financial market
C. The stock market
D. The money market
Solution: D
Section 1.7 LO 1 Easy
15. ________ are short-term debt instruments issued by the federal government.
A. Treasury bills
B. Treasury notes
C. Treasury bonds
D. Federal Reserve notes
Solution: A
Section 1.7 LO 2 Moderate
04/1/22 5
,Principles of Finance
16. ________ is a short-term, unsecured security issued by corporations and financial institutions
to meet short-term financing needs such as inventory and receivables.
A. A Treasury bill
B. Commercial paper
C. A negotiable certificate of deposit
D. A Treasury note
Solution: B
Section 1.7 LO 2 Easy
17. ________ are US government debt instruments with maturities of 2, 3, 5, 7, or 10 years.
A. Federal funds
B. Federal Reserve notes
C. Treasury notes
D. Treasury bonds
Solution: C
Section 1.7 LO 3 Easy
18. ________ investments tend to have ________ risk and ________ expected returns.
A. Long-term; less; smaller
B. Long-term; greater; greater
C. Short-term; greater; smaller
D. Short-term; less; greater
Solution: B
Section 1.8 LO 1 Moderate
19. ________ value is what a consumer pays for a product. ________ value is what a consumer
is willing to pay for a product.
A. Market; Economic
B. Economic; Market
C. Book; Market
D. Economic; Book
Solution: A
Section 1.8 LO 2 Moderate
04/1/22 6
,Principles of Finance
Review Questions
1. Identify and briefly define the three areas of study in finance.
Solution:
Business finance looks at how managers can apply financial principles to maximize the
value of a firm in a risky environment.
Investments is the study of the products and processes used to create individual and
institutional portfolios with the intent of growing wealth.
Financial markets and institutions is the study of the firms and regulatory agencies that
oversee our financial system.
Section 1.1 LO 1 Moderate
2. Identify the three focal areas in business finance.
Solution:
Working capital management (WCM) is the study and management of short-term assets
and liabilities.
Capital budgeting is the process of determining which long-term or fixed assets to
acquire in an effort to maximize shareholder value.
Capital structure is the process by which managers determine the optimal ways to
finance the firm in general and projects more specifically in an effort to make the firm’s
assets more valuable and increase shareholder wealth.
Section 1.1 LO 1 Difficult
3. Define each of the following types of risk:
inflation risk
diversifiable risk
non-diversifiable risk
political risk
Solution:
Inflation risk occurs when investors have less purchasing power from the realized cash
flows from an investment due to rising prices.
Diversifiable risk, also known as unsystematic risk, occurs when investors hold individual
securities or smallish portfolios and bear risk that a more complete portfolio could
eliminate.
Non-diversifiable risk, or systematic risk, is what remains after portfolio diversification
has eliminated unnecessary diversifiable risk.
Political risk is the risk of local, state, or national governments “changing the rules” and
disrupting firm cash flows.
Section 1.1 LO 3 Difficult
4. Identify three common components of good financial planning.
Solution: Students should identify at least three of the following or similar criteria.
04/1/22 7
,Principles of Finance
Income statements—past, current, and pro forma, or forward looking. The pro forma
income statements should develop likely scenarios and provide sensitivity analysis of
key assumptions.
Cash flow statements are a critical part of any financial planning. Cash flow goes beyond
accounting data and estimates the timing and magnitude of actual cash flows available
to meet financial obligations.
Balance sheets are critical for demonstrating the sources and uses of funds for a firm.
Forecasting in the form of expected sales, cost of funds, and micro- and macroeconomic
conditions are essential elements of financial planning.
Financial analysis including ratio analysis, common-size financial statements, and trend
statements are important aspects of financial planning. Such analysis aids in the
understanding of where a firm has been, how it stacks up against the competition, and
the assessment of target objectives.
Section 1.2 LO 2 Moderate
5. The Concepts in Practice feature in Section 1.3 discusses the importance of data for decision-
making. List at least three of the ways the article suggests managers can use financial
statements.
Solution:
1. Measure the impact of business decisions such as new software, marketing plan, or
product line
2. Aid in the development of budgets by creating a starting point for future expectations
3. Aid in cost cutting or the reduction of duplicate activities
4. Data-supported strategic planning and visioning
5. Consistent data and content across departments
6. Team motivation to set, meet, and exceed goals and objectives
Section 1.3 LO 3 Difficult
6. Describe the role of a financial analyst in a financial institution such as a bank or investment
company.
Solution: The role of financial analyst usually includes market research, financial forecasting,
modeling, cost analysis, and comparative valuations. Financial analysts gather data and produce
financial reports in conjunction with multiple departments within a business or organization. In
a bank, they would provide research analysis to provide support for providing loans. In an
investment firm, they would evaluate the value of potential investments and aid in the
purchase or sale decisions.
Section 1.4 LO 2 Moderate
7. Is a dealer or a broker more likely to be a market maker? In your answer, define the activities
of a market maker.
Solution: A dealer may also be a “market maker.” This means that they own large amounts of a
particular security and stand ready to buy or sell at the current bid or ask price. Market makers
are often brokerage firms who own large amounts of a particular security so they can quickly
04/1/22 8
,Principles of Finance
and efficiently execute trades for their retail and wholesale customers. By standing ready to
always buy or sell, dealers increase the liquidity and efficiency of the market.
Section 1.5 LO 2 Moderate
8. How can an understanding of micro- and macroeconomic factors aid in small business
decision-making?
Solution: Most small-business decisions are on the micro level. This may include decisions to
hire specific individuals, borrow money from local bankers, or expand production for a specific
customer. These decisions, however, are made in a macro environment where the small
business owner understands the national or regional outlook for economic growth, inflation,
and unemployment. For example, the national rate of unemployment may not have been much
help when Bacon Signs was searching for skilled laborers who could form neon signs. However,
the unemployment rate helped inform the company about the probability of demand for new
businesses and the signs they would need.
Section 1.6 LO 2 Difficult
9. We measure market capitalization by multiplying the number of shares of stock outstanding
by the current price per share. Go to finance.yahoo.com and determine the market
capitalization of Nike, Tesla, and Walmart. Which company has the greatest market
capitalization? Which company has the highest level of sales? If these are not the same
companies, why do you think the company with the lower sales level has greater market
capitalization?
Solution: Walmart has the highest sales, but Tesla may have greater value depending on when
the student looks at current market information. Students could argue that because stock
values represent market expectations, Tesla could expect to generate greater sales or a
combination of increased sales and profit margin than Walmart.
Section 1.7 LO 3 Difficult
Chapter 1
Test Bank
Introduction to Finance
These questions and problems can all be solved in a classroom setting using a handheld
financial calculator.
True or False Questions
1. The application of common sense is sufficient for companies to manage their financial
operations.
A. True
B. False
04/1/22 9
, Principles of Finance
Solution: B. Companies are too complex to be managed without extensive knowledge in
multiple areas of finance.
Section 1.1 LO 1 Easy
2. The Financial Industry Regulatory Authority (FINRA) is a US federal institution charged with
enforcement of US financial regulations.
A. True
B. False
Solution: B. FINRA is an independent nongovernmental organization that writes and enforces
the rules governing registered brokers and broker-dealer firms in the United States.
Section 1.1 LO 3 Moderate
3. The key common feature of market brokers and dealers is that they both act as
intermediaries.
A. True
B. False
Solution: A. Both brokers and dealers perform the function of intermediary between buyers and
sellers of securities. The difference is that dealers hold inventories of securities and therefore
stand ready to both buy and sell securities. This is not necessarily true of a broker.
Section 1.5 LO 2 Moderate
4. The term broker refers only to financial firms that buy and sell stock.
A. True
B. False
Solution: B. A broker is an intermediary that brings together the buyer and seller of any type of
asset, including stocks, bonds, real estate, and more.
Section 1.5 LO 2 Difficult
Multiple Choice Questions
1. Business finance looks at how managers apply financial principles to maximize the value of a
firm. Who benefits most when the value of the firm is maximized?
A. Management
B. Employees
C. Shareholders
D. Customers
Solution: C. Any interested party should benefit when a company is successful and increases its
value. However, shareholders “own” the increased value, so they have the most to gain.
Section 1.1 LO 1 Moderate
2. Which of the following areas of finance is a more narrowly focused subfield of one of the
other three areas?
04/1/22 10
