Glendale Community College » Business Administration » BUSAD 101 - Introduction to Business » Spring 2021

Question #1

Which of the following assets would a firm most likely finance using long-term sources?

A. Inventory

B. Another company

C. Marketable securities

D. Accounts receivable

Question #2

_____ would be the LEAST likely to obtain a private placement.

A. Life insurance companies

B. Pension fund managers

C. Commercial banks

D. Small individual investors

Question #3

Most private placements are _____.

A. U.S. government securities

B. municipal debt issues

C. corporate equity issues

D. corporate debt issues

Question #4

Trade credit is a major source of short-term financing.

A. TRUE

B. FALSE

Question #5

Firms often rely on short-term sources of funds to pay for large, permanent assets, such as machinery and buildings.

A. TRUE

B. FALSE

Question #6

Short-term sources of funds are loans that are repaid within one year.

A. TRUE

B. FALSE

Question #7

Interest rates on short-term funds move up and down frequently.

A. FALSE

B. TRUE