Question 1

The Toxic Real Asset Problem (TRAP),which was passed as part of the Economic Stabilization Act of 1978 enabled the U.S.Treasury to purchase up to $700 billion of troubled assets held by financial institutions.

Accepted Answer

A) True 
 B)False

Question 2

How an individual or organization treats others legally,fairly and honestly is called:

Accepted Answer

A)  legal behavior
B)  moral behavior
C)  ethical behavior
D)  none of the above

Question 3

The study of how growth-driven,performance-focused,early stage firms raise financial capital and manage operations and assets is called:

Accepted Answer

A)  entrepreneurial finance
B)  personal finance
C)  finance
D)  financial management

Question 4

Checks:

Accepted Answer

A)  are orders to depository institutions to transfer money to the party who received the check
B)  may be safely sent in the mail
C)  provide a record of payment
D)  all of the above
E)  none of the above

Question 5

The saving-investment process involves which of the following financial functions:

Accepted Answer

A)  creating and transferring money
B)  accumulating savings and lending and investing money
C)  marketing and transferring financial assets
D)  all of the above

Question 6

The financial crisis of 2007-2009 resulted from a number of negative economic and financial trends except:

Accepted Answer

A)  a decline in housing prices
B)  poor ratings assigned by credit rating agencies
C)  mortgage defaults
D)  high debt levels
E)  a decline in stock prices

Question 7

The financial environment:

Accepted Answer

A)  encompasses the financial markets and global interactions that contribute to an efficiently operating economy.
B)  encompasses the financial institutions and financial markets that contribute to an efficiently operating economy.
C)  encompasses the financial system,financial institutions,financial markets,business firms,individuals,and global interactions that contribute to an efficiently operating economy.
D)  none of the above. C

Question 8

______________ behavior refers to how an individual or organization treats others legally,fairly,and honestly.

Accepted Answer

A)  Principal-agent
B)  Stakeholder
C)  Responsible
D)  Ethical
E)  none of the above

Question 9

____________________ in business involves making decisions relating to the efficient use of financial resources in the production and sale of goods and services.

Accepted Answer

A)  Financial management
B)  Financial economics
C)  Investment management
D)  Asset allocation
E)  none of the above

Question 10

Successful businesses typically progress through a series of life-cycle stages-from the idea stage to exiting the business;these five stages include the:

Accepted Answer

A)  development stage,startup stage,survival stage,rapid growth stage,and maturity stage.
B)  idea stage,design stage,operating stage,rebuilding stage,and decline stage
C)  development stage,operating stage,rebuilding stage,rapid growth stage,and maturity stage
D)  idea stage,startup stage,rapid growth stage,survival stage,and decline stage

Question 11

An area of finance that refers to the physical locations or electronic forums that facilitate the flow of funds among investors,businesses,and governments is called:

Accepted Answer

A)  financial management
B)  investments
C)  financial institutions
D)  financial markets
E)  none of the above

Question 12

The six principles of finance include (1)Money has a time value,(2)Higher returns are expected for taking on more risk,(3)Diversification of investments can reduce risk,(4)Financial markets are efficient in pricing securities,(5)Manager and stockholder objectives may differ,and (6)Reputation matters.

Accepted Answer

A) True 
 B)False

Question 13

The issuing of new securities,mortgages,and other claims to wealth takes place in the:

Accepted Answer

A)  secondary market
B)  money market
C)  primary market
D)  securities market

Question 14

Finance is:

Accepted Answer

A)  the study of how individuals,institutions,governments,and businesses acquire,spend,and manage money and other financial assets
B)  the study of how businesses acquire,spend,and manage money and other financial assets
C)  the study of how governments,and businesses acquire,spend,and manage money and other financial assets
D)  none of the above

Question 15

An area of finance that involves the study of government institutions and their involvement in rescuing private firms is called:

Accepted Answer

A)  financial management
B)  investments
C)  financial institutions
D)  financial markets
E)  none of the above

Question 16

An efficient ______________ that is comprised of a central bank and a banking system that is able to create and transfer a stable medium of exchange called money.

Accepted Answer

A)  allocation system
B)  banking system
C)  investment system
D)  market system
E)  none of the above

Question 17

________________ is the study of how individuals,institutions,governments,and businesses acquire,spend,and manage financial resources.

Accepted Answer

A)  financial markets
B)  financial institutions
C)  finance
D)  financial management

Question 18

Intermediaries that help the financial system operate efficiently and transfer funds from savers and investors to individuals,businesses,and governments that seek to spend or invest the funds are known as:

Accepted Answer

A)  financial markets
B)  financial institutions
C)  securities markets
D)  government organizations B

Question 19

Functions of the monetary system include all of the following except

Accepted Answer

A)  creating money
B)  transferring money
C)  accumulating savings
D)  Lending and investing savings
E)  all of the above are included E

Question 20

_________________________________________ are crucial elements of the financial environment and well-developed financial systems.

Accepted Answer

A)  Businesses and the federal government
B)  International organizations such as the World Bank and International Monetary Fund
C)  Well-developed barter systems
D)  Financial institutions,financial markets,and investment and financial management

Exam 1: The Financial Environment

The Toxic Real Asset Problem (TRAP),which was passed as part of the Economic Stabilization Act of 1978 enabled the U.S.Treasury to purchase up to $700 billion of troubled assets held by financial institutions.

Correct Answer
verified

How an individual or organization treats others legally,fairly and honestly is called:

Correct Answer
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The study of how growth-driven,performance-focused,early stage firms raise financial capital and manage operations and assets is called:

Correct Answer
verified

Checks:

Correct Answer
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The saving-investment process involves which of the following financial functions:

Correct Answer
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The financial crisis of 2007-2009 resulted from a number of negative economic and financial trends except:

Correct Answer
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The financial environment:

Correct Answer
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C

______________ behavior refers to how an individual or organization treats others legally,fairly,and honestly.

Correct Answer
verified

____________________ in business involves making decisions relating to the efficient use of financial resources in the production and sale of goods and services.

Correct Answer
verified

Successful businesses typically progress through a series of life-cycle stages-from the idea stage to exiting the business;these five stages include the:

Correct Answer
verified

An area of finance that refers to the physical locations or electronic forums that facilitate the flow of funds among investors,businesses,and governments is called:

Correct Answer
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Correct Answer
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The issuing of new securities,mortgages,and other claims to wealth takes place in the:

Correct Answer
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Finance is:

Correct Answer
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An area of finance that involves the study of government institutions and their involvement in rescuing private firms is called:

Correct Answer
verified

An efficient ______________ that is comprised of a central bank and a banking system that is able to create and transfer a stable medium of exchange called money.

Correct Answer
verified

________________ is the study of how individuals,institutions,governments,and businesses acquire,spend,and manage financial resources.

Correct Answer
verified

Intermediaries that help the financial system operate efficiently and transfer funds from savers and investors to individuals,businesses,and governments that seek to spend or invest the funds are known as:

Correct Answer
verified
B

Functions of the monetary system include all of the following except

Correct Answer
verified
E

_________________________________________ are crucial elements of the financial environment and well-developed financial systems.

Correct Answer
verified

Exam 1: The Financial Environment

The Toxic Real Asset Problem (TRAP),which was passed as part of the Economic Stabilization Act of 1978 enabled the U.S.Treasury to purchase up to $700 billion of troubled assets held by financial institutions.

Correct AnswerverifiedShow Answer

How an individual or organization treats others legally,fairly and honestly is called:

Correct AnswerverifiedShow Answer

The study of how growth-driven,performance-focused,early stage firms raise financial capital and manage operations and assets is called:

Correct AnswerverifiedShow Answer

Checks:

Correct AnswerverifiedShow Answer

The saving-investment process involves which of the following financial functions:

Correct AnswerverifiedShow Answer

The financial crisis of 2007-2009 resulted from a number of negative economic and financial trends except:

Correct AnswerverifiedShow Answer

The financial environment:

Correct AnswerverifiedC

______________ behavior refers to how an individual or organization treats others legally,fairly,and honestly.

Correct AnswerverifiedShow Answer

____________________ in business involves making decisions relating to the efficient use of financial resources in the production and sale of goods and services.

Correct AnswerverifiedShow Answer

Successful businesses typically progress through a series of life-cycle stages-from the idea stage to exiting the business;these five stages include the:

Correct AnswerverifiedShow Answer

An area of finance that refers to the physical locations or electronic forums that facilitate the flow of funds among investors,businesses,and governments is called:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The issuing of new securities,mortgages,and other claims to wealth takes place in the:

Correct AnswerverifiedShow Answer

Finance is:

Correct AnswerverifiedShow Answer

An area of finance that involves the study of government institutions and their involvement in rescuing private firms is called:

Correct AnswerverifiedShow Answer

An efficient ______________ that is comprised of a central bank and a banking system that is able to create and transfer a stable medium of exchange called money.

Correct AnswerverifiedShow Answer

________________ is the study of how individuals,institutions,governments,and businesses acquire,spend,and manage financial resources.

Correct AnswerverifiedShow Answer

Intermediaries that help the financial system operate efficiently and transfer funds from savers and investors to individuals,businesses,and governments that seek to spend or invest the funds are known as:

Correct AnswerverifiedB

Functions of the monetary system include all of the following except

Correct AnswerverifiedE

_________________________________________ are crucial elements of the financial environment and well-developed financial systems.

Correct AnswerverifiedShow Answer

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C

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B

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E

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