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

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Question #1
Break-even analysis includes
A.   liquid and non-liquid assets
B.   payback analysis
C.   fixed and variable costs
D.   an appropriately determined discount rate
Question #2
An organization that is highly financially leveraged has
A.   a positive net margin
B.   a high current ratio
C.   a high debt-to-assets ratio
D.   a low operating 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.   revenues
C.   depreciation
D.   personnel expenses
Question #5
Return on assets is a
A.   activity ratio
B.   profitability ratio
C.   debt ratio
D.   liquidity ratio
Question #6
Why would an organization want to have a short average payment period?
A.   It frees up cash for other purposes.
B.   It indicates positive cash flow.
C.   It encourages vendors to provide higher discounts.
D.   It lowers discount rates.
Question #7
Appropriate liquidity enables an organization to
A.   meet its short-term financial obligations and carry out planned financial transactions
B.   minimize the amount of interest it can earn on its invested monies
C.   understand the amount of debt needed to fund long-term projects
D.   quickly sell almost all of its assets if threatened with bankruptcy
Question #8
Variable costs
A.   always increase with volume increases
B.   change only within a range of volume.
C.   change in correlation with fixed costs.
D.   always decrease with volume decreases
Question #9
A major difference between operating margin and net margin is that net margin accounts for
A.   depreciation
B.   all revenue sources
C.   cash flows
D.   arbitrage
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.   Asset turnover
C.   Debt-to-asset ratio
D.   Operating margin

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