Quiz Ch 01 – T/F Partnerships and Double Taxation
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
True or false: A significant drawback of partnerships is the potential for double taxation of profits.
True or false: A significant drawback of partnerships is the potential for double taxation of profits.
True or false: Maximizing profits is synonymous with maximizing the firm’s value.
True or false: A project is financially attractive when its value is lower than the required investment.
True or false: Shareholders embrace elevated short-term profits, even at the expense of long-term gains.
True or false: Sole proprietors’ liability is confined to their investment in the company.
True or false: Considering an IOU (“I owe you”) from your brother-in-law as a financial asset is valid.
True or false: An effectively crafted compensation package can contribute to a company’s pursuit of maximizing its market value.
True or false: Financial assets derive their value from being claims on the cash generated by the firm’s real assets.
True or false: Building and maintaining long-term relationships while maintaining a strong reputation can enable established firms to create value.
How long does the legal existence of a corporation last?