11. Which of the following is a correctstatement?
A. The objective of short-term financial management is to maximizecarrying costs.
B. Managing short-term cash flows involves minimizingliquidity.
C. In managing short-term finances, a financial manager should seekthe optimal level of investment in fixed assets.
D. A financial manager should use a cash budget to identifyshort-term financial needs.
E. In an ideal economy, the optimal level of net working capital ispositive.

12. A firm needs to raise cash and at the same timereduce the level of its accounts receivable. This firm would likelybenefit most by _______________________.
A. obtaining an unsecured short-term loan.
B. applying for a committed line of credit.
C. assigning its receivables on a short-term loan.
D. factoring its receivables.
E. securing any short-term credit with a blanket inventorylien.

13. Mycale's has always paid its suppliers in 30 days.The company just hired a new financial officer who is changing thepolicy such that suppliers will now be paid in 45 days. This changewill ______ the accounts payable period and _______ the cashcycle.
A. Increase; not affect
B. Increase; increase
C. Increase; decrease
D. Decrease; increase
E. Decrease; decrease

14. Which of the following are sources ofcash?
I. marketable securities are sold
II. the amount of inventory on hand is increased
III. the firm takes out a long-term bank loan
IV. payments are paid on accounts payable
A. I and III only
B. II and IV only
C. I and IV only
D. II and III only
E. II, III and IV only

15. The ABC Company contacts the shareholders of XYZCompany and offers to buy their shares at a premium. This is anillustration of a:
A. Leveraged buyout.
B. Going-private transaction.
C. Tender offer.
D. Vertical acquisition.
E. Conglomerate acquisition.