Business Finance and Venture Capital Quiz

What is the primary objective of corporate finance?

• Maximizing shareholder wealth

• Minimizing taxes

• Increasing company size

• Reducing operational risks

Which financial statement summarizes a company's revenues and expenses?

• Balance sheet

• Income statement

• Cash flow statement

• Statement of changes in equity

What is the formula for working capital?

• Total assets - total liabilities

• Current assets - current liabilities

• Total equity - total debt

• Operating profit - interest expense

What does the term 'leverage' refer to in finance?

• Use of equity for funding

• Use of debt to finance assets

• Reduction of expenses

• Increasing shareholder equity

What is a common measure of a company's profitability?

• Debt-to-equity ratio

• Return on equity (ROE)

• Current ratio

• Quick ratio

Which type of financing involves selling shares of a company?

• Debt financing

• Equity financing

• Venture capital

• Crowdfunding

What is the main advantage of issuing bonds?

• No repayment obligation

• Fixed interest payments

• Ownership dilution

• Tax benefits

Which is NOT a component of the cost of capital?

• Cost of debt

• Cost of equity

• Cost of retained earnings

• Cost of liabilities

What is the purpose of a budget?

• To record historical performance

• To forecast future financial performance

• To track stock market trends

• To calculate taxes

What is the term for assets that can be converted into cash within one year?

• Fixed assets

• Current assets

• Intangible assets

• Non-current assets