Q.1.1.1 Finance can be defined as: a) The art of science of managing money. b) The system of debits and credits. c) The art of merchandising products and services. d) The science of production, distribution and consumption of wealth. Q.1.1.2 Which one of the following is NOT one of the primary activities of the financial manager? a) Perform financial analysis. b) Prepare financial statements. c) Make financial decisions. d) Make investment decisions. Q.1.1.3 The conflict between the goals of a firm’s owner and the goals of its non- owner managers is known as: a) Incompatibility. b) Of little importance in most large South African firms. c) The agency problem. d) The agency relationship. Q.1.1.4 Which one of the following may help eliminate the agency problem? a) Increases based on the value of assets under management. b) Fixed salaries for all corporate executives. c) Share options used as management compensation. d) Executive bonuses based off increased sales.
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1.1.1 The correct answer is a) The art of science of managing money. Q.1.1.2 The correct answer is b) Prepare financial statements. This is typically the responsibility of accountants, not financial managers. Show more…
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