HEA 478 - Strategic Management in Healthcare » Fall 2021 » Chapter 9 Quiz

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Question #1
Break-even analysis includes
A.   payback analysis
B.   an appropriately determined discount rate
C.   liquid and non-liquid assets
D.   fixed and variable costs
Question #2
An organization that is highly financially leveraged has
A.   a high current ratio
B.   a low operating margin
C.   a positive net margin
D.   a high debt-to-assets ratio
Question #3
All of the following are major problems with net present value except
A.   the finite amount of available capital
B.   determining an accurate discount rate
C.   accurately determining future cash flows
D.   accounting for nonfinancial, mission-based reasons
Question #4
Operating statements include all of the following except
A.   asset values
B.   personnel expenses
C.   revenues
D.   depreciation
Question #5
Return on assets is a
A.   activity ratio
B.   liquidity ratio
C.   debt ratio
D.   profitability ratio
Question #6
Why would an organization want to have a short average payment period?
A.   It lowers discount rates.
B.   It encourages vendors to provide higher discounts.
C.   It indicates positive cash flow.
D.   It frees up cash for other purposes.
Question #7
Appropriate liquidity enables an organization to
A.   quickly sell almost all of its assets if threatened with bankruptcy
B.   meet its short-term financial obligations and carry out planned financial transactions
C.   understand the amount of debt needed to fund long-term projects
D.   minimize the amount of interest it can earn on its invested monies
Question #8
Variable costs
A.   change only within a range of volume.
B.   change in correlation with fixed costs.
C.   always decrease with volume decreases
D.   always increase with volume increases
Question #9
A major difference between operating margin and net margin is that net margin accounts for
A.   cash flows
B.   all revenue sources
C.   arbitrage
D.   depreciation
Question #10
A key aspect of net present value is
A.   time value of money
B.   accounting for depreciation
C.   salvage values
D.   unequal cash flows
Question #11
Which of the following is a measure of liquidity?
A.   Operating margin
B.   Debt-to-asset ratio
C.   Asset turnover
D.   Acid or quick ratio

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