1.The ________ is created by a number of institutions and arrangements that allow the suppliers and demanders of long-term funds to make transactions.

1. 1. financial market
2. 2. money market
3. 3. capital market
4. 4. credit market

2.In general, most corporate capital gains are taxed at ________ tax rate.

1. 1. a 30 percent
2. 2. the ordinary
3. 3. a 28 percent
4. 4. a 46 percent

3.Under which of the following legal forms of organization, is ownership readily transferable?

1. 1. Limited partnership.
2. 2. Partnerships.
3. 3. Sole proprietorships.
4. 4. Corporation.

4.The ________ has/have the ultimate responsibility in guiding corporate affairs and carrying out policies.

1. 1. stockholders
2. 2. creditors
3. 3. chief executive officer
4. 4. board of directors

5.Marginal analysis states that financial decisions should be made and actions taken only when

1. 1. added benefits are greater than zero.
2. 2. demand equals supply.
3. 3. added benefits exceed added costs.
4. 4. benefits equal costs.

6.The agency problem may result from a manager's concerns about any of the following EXCEPT

1. 1. company-provided perquisites.
2. 2. personal wealth.
3. 3. job security.
4. 4. corporate goals.