Financial Management - Study Mode
[#766] The decision function of financial management can be broken down into the__________ decisions.
Correct Answer
(B) investment, financing, and asset management
Explanation
Solution: The decision function of financial management can be broken down into the investment, financing, and asset management decisions.
[#767] Which of the following portfolios has the least reduction of risk?
Correct Answer
(A) A portfolio with securities all having positive correlation with each other
Explanation
Solution: A portfolio with securities all having positive correlation with each other has the least reduction of risk. A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds.
[#768] The time required to process and execute an order is called
Correct Answer
(B) lead time
Explanation
Solution: The time required to process and execute an order is called lead time. Lead time is the amount of time that passes from the start of a process until its conclusion.
[#769] Portfolio risk is best measured by the______________.
Correct Answer
(C) weighted average of individual risk
Explanation
Solution: Portfolio risk is best measured by the weighted average of individual risk. Portfolio risk is a chance that the combination of assets or units, within the investments that you own, fail to meet financial objectives.
[#770] The focal point of financial management in a firm is _________.
Correct Answer
(C) the creation of value for shareholders
Explanation
Solution: The focal point of financial management in a firm is the creation of value for shareholders.