Corporate Finance: Damodaran (1) y (2)

According to Damodaran, the classification of assets on the balance sheet from the perspective of finances are:

• Assets in place and Growth Assets

• Current Assets and Non current Assets

• Current Assets and Growth Assets

• Assets in place and Non current Assets

The principle where the return must exceed the required rate of return is called:

• Financing Principle

• Investment Principle

• Dividend Principle

• None of the above

The principle in which the perfect mix between debt and equity must be found to maximize the value of the business or minimize the Hurdle rate is:

• Financing Principle

• Investment Principle

• Dividend Principle

• None of the above

The principle in which as an investor you cannot find an attractive investment or that exceeds the hurdle rate, the most advisable thing is to five cach back to the owners:

• Financing Principle

• Investment Principle

• Dividend Principle

• None of the above

Which of the following decisions is a corporate finance decision?

• An acquisition of another company

• A change in pricing strategy

• An accounting revaluation of assets on the balance sheet (with no tax implications)

• Adding a child care center for employee’s children

• All of the above

Which of the following is the primary mission of a board of directors in a publicly traded firm?

• To provide advice and counsel to the top managers of the firm

• To protect incumbent managers from stockholder pressures and defend them against criticism.

• To ensure that top managers are acting in the best interests of the stockholders

• To protect society’s best interests

• None of the above