When Developing a Financial Plan for a Corporation You Should

question 67

Multiple Choice

When developing a financial plan for a corporation you should consider which of the following?
I. How much net working capital will be needed?
II. Will additional fixed assets be required?
III. Will dividends be paid to shareholders?
IV. How much new debt must be obtained?

• A) I and IV only
• B) II and III only
• C) I, III, and IV only
• D) II, III, and IV only
• E) I, II, III, and IV

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Definitions:

Capital Quality

The effectiveness or productivity of capital goods, which can be improved through technological advancements or better skills training.

Per-worker Production Function

A mathematical representation of the output produced by the average worker, evaluating the relationship between labor input and production.

Production Function

A mathematical equation that describes the relationship between inputs used in production and the output generated from those inputs.

Productivity

The efficiency at which goods or services are produced, often measured as the amount of output per hour of labor.