LN-U AA - 23 – 02 – 01 - 18

LYCEUM-NORTHWESTERN UNIVERSITY
Tapuac District, Dagupan City

Senior High School

MIDTERM EXAMINATION IN
BUSINESS FINANCE
1st Semester, AY 2019-2020
Prepared by: Jolina A. Reyes
Name of Student: ____________________________________ Score ________/
Student No.: ______________ Course/Year: _________________ Date of Examination:
____________

Instruction: Choose the best letter corresponding to the question. If no answer in the
choices, kindly write the correct answer.

I- Instruction. Complete the statement and put your answer on the space
provided.
___________________1. It means determining where to use funds currently available to the
firm

___________________2. Finance is derived from the Latin word _________, meaning to

end or to pay.

___________________3. What is the formula of EPS

___________________4. It must be made available at the least cost when it is needed.

___________________5. It involves financial intermediaries in the real sense of word.

___________________6. The ____________ of a business refers to his contribution to the

improvement of the quality of life in the community.

___________________7.It is otherwise called managerial finance, is concerned with the

management of funds.

___________________8.It means obtaining funds from the right sources at the right time.

___________________9.All finance other than public finance, is __________ finance

___________________10. On Borrowed funds, it is in the form of financing charges,

(interest, commissions, and service charges).
Test II- Multiple choice. Choose the best answer and put it on the space provided before the
number. Write your answer in Capital Letters

___________________1. It is composed of savings and mortgage banks, private

development banks stocks savings and loans.

a. Capital Market

b. Thrift Banking System

c. Thrift Banking System

d. Depository Institution

___________________2. Consist of underwriters, issuers and instruments. They raise cash

for issuing company.

a. Capital Market

b. Primary market

c. Secondary Market

d. Financial Market

___________________3. As the name implies refers to financial institution that accept

deposits from surplus unit.

a. Stock Market

b. Primary market

c. Non Depository Institution

d. Depository Institution

___________________4. Is a specialty coverage not covered under any property or home

owners or endorsements?

a. Life insurance
 b. Professional liability insurance

c. Casualty Insurance

d. Umbrella Liability insurance

___________________5. Defined as a need for assistance with some if the activities of

daily living

a. Health insurance

b. Home owner’s insurance

c. Casualty Insurance

d. Long term care

___________________6. Refers to the additional policy that starts when other insurance
policy has reached its limit

a. Life insurance

b. Professional liability insurance

c. Casualty Insurance

d. Umbrella Liability insurance

___________________7. It provides help if a person meets an accident. It does not cover

property alone but also individuals

a. Life insurance

b. Professional liability insurance

c. Casualty Insurance

d. Umbrella Liability insurance

___________________8. Sell contracts to provide income to policy holders during their
retirement years.

a . Mutual funds

b. Professional liability insurance

c. Pension fund Companies

d. Stock

___________________9.It represents the largest single group, resource wise , of financial

institution in the country

a. Life insurance

b. Professional liability insurance

c. Casualty Insurance

d. Umbrella Liability insurance

___________________10. Perform the simpler functions of accepting deposit and granting

loans. They do not do investment function.

a. Life insurance

b. Professional liability insurance

c. Casualty Insurance

d. Umbrella Liability insurance

 Enumeration

3 Goals of financial manager that have to be maximize

1.

2.

3.

7 Goals of financial managers

1.

2.

3.

4.

5.

6.

7.

Financial Market as to term of Maturity

1.

2.

Financial Market as to type of issue

1.

2.

II-Illustration

Draw the Structure of Individual franchise, Area franchise and master franchise
Enumeration

1. Steps in Franchising (Franchisor point of view)

2. Common Mistake of franchising

3. Factors to consider before entering a franchise?

Case Study:

Krispy Kreme’s Rise and Fall

Krispy Kreme is one example of a franchise-gone-wrong. The Krispy Kreme craze in the
early 2000s drove millions of customers to stores, waiting in line for the cherished fresh glazed
delicacies. As a result of the demand, the number of Krispy Kreme franchises exploded, with
new entrepreneurs trying to enter in the market. New stores emerged in 400 locations all over
the country and the world, and the Krispy donut that enjoyed a large fan base in the South soon
had hungry customers in New York, LA, Seattle, Las Vegas, and almost everywhere else.

However, the rapid growth became a problem for Krispy Kreme, and a few years later,
the financial fallout became apparent.

1. What can you learn as an entrepreneur who wishes to run a franchise and avoid the
franchise risks?
Reviewed and checked by:

Dr. Genoveva Y. Reyes, CPA, FRIAcc

Dean, College of Business Education