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

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