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.   fixed and variable costs
C.   payback analysis
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 low operating 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.   accurately determining future cash flows
C.   determining an accurate discount rate
D.   accounting for nonfinancial, mission-based reasons
Question #4
Operating statements include all of the following except
A.   depreciation
B.   personnel expenses
C.   asset values
D.   revenues
Question #5
Return on assets is a
A.   debt ratio
B.   activity ratio
C.   liquidity ratio
D.   profitability ratio
Question #6
Why would an organization want to have a short average payment period?
A.   It encourages vendors to provide higher discounts.
B.   It lowers discount rates.
C.   It frees up cash for other purposes.
D.   It indicates positive cash flow.
Question #7
Appropriate liquidity enables an organization to
A.   meet its short-term financial obligations and carry out planned financial transactions
B.   understand the amount of debt needed to fund long-term projects
C.   minimize the amount of interest it can earn on its invested monies
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.   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.   depreciation
B.   all revenue sources
C.   arbitrage
D.   cash flows
Question #10
A key aspect of net present value is
A.   time value of money
B.   salvage values
C.   accounting for depreciation
D.   unequal cash flows
Question #11
Which of the following is a measure of liquidity?
A.   Asset turnover
B.   Acid or quick ratio
C.   Operating margin
D.   Debt-to-asset ratio

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