A business that has a provision, in its agreements with financers, that it can pay back...

A business that has a provision, in its agreements with financers, that it can pay back or reduce what is owed before its due date, would be an example of a ___ consideration. Select one: a. Control O b. Timing O c. Flexibility d. Suitability A firm is said to be highly geared when it obtains a substantial proportion of its finance from: Select one: a. Debtors b. Debt c. Creditors d. Equity

An effective financial manager would finance temporary current assets (such as inventory) with: Select one: a. Fixed short-term debt b. Fixed long-term debt c. Equity d. Flexible short-term debt e. Flexible long-term debt Assuming that the standard rate of company tax applies, if a business pays interest on a loan at the rate of 15%, what is the after-tax cost of debt? Select one: a 15% b. 4.2% c. 28% d. 10.8%

Debt that is scheduled to fall due five years after being taken out is regarded as: Select one: 10 a. Medium-term debt b. Short-term debt c. Long-term debt If the business is running at a loss, interest payments on debt do not have to be met until such time as the business is profitable again. Select one: True False

Maximising the wealth of the firm is achieved by: Select one: O a. Maximising the cost of capital; minimising risk; minimising retum on assets O b. Minimising the cost of capital; maximising risk, minimising return on assets c. Minimising the cost of capital; minimising risk; maximising return on assets O d. Maximising the cost of capital; maximising risk; maximising return on assets o Owners being restricted from making withdrawals from the business, to protect the interest of creditors, would be related to the the claim on income or assets. Select one: a. Maturity b. Certainty c. Priority d. Amount