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Financial Management

Notes 1.7 Review Questions

1. What are the tasks of Financial Management?
2. Discuss the salient features of the traditional approach to corporation finance.
3. Discuss the distinctive features of modern approach to corporation finance.

4. What is the normative goal of Financial Management?
5. “Financial Management is an integral part of the jobs of all managers. Hence, it cannot be
entrusted to a staff department”. Discuss.

6. Discuss some of the problems financial managers in a developing country like India have
to grapple with.
7. Draw a typical organization chart highlighting the finance function of a company.

8. “The profit maximization is not an operationally feasible criterion.” Do you agree? Justify.
9. ‘Finance is considered to be the blood of the enterprise’. Justify.
10. You are the finance manager of a firm and asked to organize all the financial decisions of
the firm. Elucidate the ways in which you will do it.
Answers: Self Assessment
1. raising of funds 2. procurement of funds
3. working capital 4. Gross

5. direct 6. Wealth maximization
7. detrimental 8. judgment
9. Dividend 10. financing
11. lifeblood 12. Investment

13. long-term, short-term 14. company
15. centralized 16. share prices

1.8 Further Readings

Books Dr Pradeep Kumar Sinha, Financial Management, New Delhi, Excel Books, 2009.
Van Horne, J.C. and Wachowicz, Jr, J.M., Fundamentals of Financial Management,
New Delhi, Prentice Hall of India Pvt. Ltd., 1996, p. 2.
Chandra, P., Financial Management—Theory and Practice, New Delhi, Tata McGraw
Hill Publishing Company Ltd., 2002, p. 3.

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