Chapter 1- FINANCE

Question 0

Some say that it is the art and science of managing money

Answer 0

Finance

Question 1

It is the study of how individuals, institutions, governments and business acquire, spend and manage money and other financial assets

Answer 1

Finance :)

Question 2

3 functions of finance

Answer 2

1. Procurement or gathering of funds
2. Effective and efficient utilization of financial resources
3. Allocation of financial assets or resources

Question 3

This includes the financial systems, institutions, markets and individuals that make the economy operate efficiently

Answer 3

Financial environment

Question 4

These are organizations 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 in physical assets.

Answer 4

Financial Institutions

Question 5

Examples of Financial Institutions

Answer 5

intermediaries like banks, insurance companies and investment companies

Question 6

These are physical locations that facilitate the flow of funds among investors and businesses. They provide the means of allocating financial resources or funds from savers to borrowers.

Answer 6

Financial markets

Question 7

This involves financial planning, asset management, and fundraising decisions to enhance the value of businesses.

Answer 7

Financial management

Question 8

Disciplines related to Finance

Answer 8

Economics and Accounting

Question 9

The social science that studies how individuals, governments, firms and nations make choices on allocating scarce resources to satisfy their unlimited wants.

Answer 9

Economics

Question 10

This concentrates on the behavior of the aggregate economy

Answer 10

Macroeconomics

Question 11

This focuses on individual consumers

Answer 11

Microeconomics

Question 12

Economists use a ________ framework to explain how the prices of quantities of goods and services are determined in a free-market economic system

Answer 12

Supply-and-demand

Question 13

It is the system of recording and summarizing business and financial transactions and analyzing, verifying and reporting the results

Answer 13

Accounting

Question 14

They supply the record-keeping mechanism for showing ownership of the investments used in the flow of funds among savers and borrowers. They also record revenues, expenses snd profitability of organizations that produce and exchange goods and services

Answer 14

Accountants

Question 15

It is very vital that the ______ is knowledgeable in Accounting and Economics.

Answer 15

Financial manager

Question 16

The objective of every financial manager in a profit-seeking organization

Answer 16

To maximize the owners’ wealth

Question 17

Why study finance

Answer 17

1. To make informed economic decisions
2. To make informed personal and business decisions
3. To make informed career decisions