Froggy Jumps Game Time :DOnline version Finance is Fun :) by Heba Hathout 1 Jenna has been promoted and is now in charge of all external financing. In other words, she is in charge of: a Capital structure management. b Capital budgeting. c Working capital management. 2 Uptown Markets is financed with 45 percent debt and 55 percent equity. This mixture of debt and equity is referred to as the firm's: a Capital structure. b Working capital. c Capital budget. 3 The potential conflict of interest between a firm's owners and its managers is referred to as which type of conflict? a Organisational b Agency c Structural 4 Which one of the following is a capital structure decision? a Determining the optimal inventory level b Establishing the preferred debt-equity level c Selecting new equipment to purchase 5 The primary goal of financial management is most associated with increasing the: a Dollar amount of each sale. b Firm's liquidity. c Market value of the firm. 6 An agency issue is most apt to develop when: a The control of a firm is separated from the firm’s ownership. b The firm’s owner is also its key manager. c A firm downsizes. 7 Left to themselves, managers would tend to maximize the amount of resources over which they have control. a True b False c 8 An agency relationship exists whenever someone ( the agent) hires someone (the principal) to represent his or her interest. a True b False c 9 A principal-agent problems occur when managerial decisions are not consistent with the firm's shareholders' interests. a True b False c
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