ASSESSMENT # 1 Multiple Choice 1.The is created by a financial relationship between suppliers and users of short-term funds. A. financial market B. money market C. stock market D. capital market 2. Firms that require funds from external sources can obtain them from financial markets. B. private placement. C. financial institutions. D. All of the above. 3. The major securities traded in the capital markets are A. stocks and bonds. B. bonds and commercial paper. C. commercial paper and Treasury bills. D. Treasury bills and certificates of deposit. 4. The primary goal of the financial manager is A. minimizing risk. B. maximizing profit. C. maximizing wealth. D. minimizing return. 5. A financial manager must choose between four alternative Assets: 1, 2, 3, and 4. Each asset costs $35,000 and is expected to provide earn-ings over a three-year period as described below. Asset Year 1 Year 2 Year 3 1 $21,000 2 $ 9,000 $ 15,000 $15,000 $ 6,000 $21,000 3 $ 3,000 4 $ 6,000 $ 20,000 $ 19,000 $ 12,000 $ 12,000 Based on the profit maximization goal, the financial manager would choose A. Asset 1. B. Asset 2. C. Asset 3. D. Asset 4