The primary objective of modern financial management is to:

Here are the answers to the multiple-choice questions:

1. The primary objective of modern financial management is to: B. Maximise shareholders' wealth This objective focuses on increasing the market value of the company's shares, which benefits the shareholders.

2. Which one of the following is an example of a current asset? C. Inventory Current assets are assets expected to be converted into cash or used up within one year. Inventory fits this description.

3. Which financial market deals mainly in short-term securities? B. Money Market The money market is where short-term debt instruments (like commercial paper, treasury bills) are bought and sold.

4. The agency problem arises because... A. Managers and shareholders may pursue different objectives. The agency problem occurs when the interests of the agents (managers) diverge from the interests of the principals (shareholders).

5. The formula for Net Sales is... B. Sales Revenue - Sales Returns Net Sales represents the revenue earned from sales after accounting for any goods returned by customers.

6. Which investment appraisal technique considers the time value of money? C. Net Present Value Net Present Value (NPV) discounts future cash flows to their present value, thereby incorporating the time value of money.

7. Which of the following is an advantage of debt financing? C. Interest may be tax deductible Interest payments on debt are often tax-deductible, which reduces the effective cost of debt for the company.

8. Working capital is calculated as... B. Current Assets - Current Liabilities Working capital measures a company's short-term liquidity, representing the difference between its current assets and current liabilities.