Business Studies/Corporate Finance MCQ Set 1 Sample Test,Sample questions

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Question:
 A company having easy access to the capital markets can follow a ____________. dividend policy

1. liberal.

2.formal

3.strict

4.Varying

Posted Date:-2022-01-06 01:26:30


Question:
 A fixed rate of ____________is payable on debentures.

1.dividend

2.commission

3.interest

4.brokerage

Posted Date:-2022-01-05 23:08:27


Question:
 A fixed rate of ____________is payable on debentures.

1.dividend

2.commission

3.interest

4.brokerage

Posted Date:-2022-01-05 23:08:39


Question:
 Arbitrage is the level processing technique introduced in ____________.

1.. Net income approach

2. MM approach

3.Operating approach

4.Traditional approach.

Posted Date:-2022-01-05 23:39:19


Question:
 Factoring is a form of financing ___.

1.payable.

2.receivables

3.borrowings

4.debts

Posted Date:-2022-01-06 01:09:34


Question:
 Finance function is one of the most important functions of ____________.

1.business.

2.marketing

3.financial

4.debt

Posted Date:-2022-01-05 23:27:39


Question:
 Financial leverage helps one to estimate ____________.

1. the business risk

2.the financial risk

3.both risks

4.production risk.

Posted Date:-2022-01-05 22:46:47


Question:
 Future value interest factor takes ____

1. Compounding rate

2.Discounting rate.

3.Inflation rate

4.Deflation rate.

Posted Date:-2022-01-05 22:11:24


Question:
 ICICI was formed in _______:

1.1955

2.1665

3.1965

4.1954

Posted Date:-2022-01-05 22:35:41


Question:
 If the payback is a bad rule, the average returns on book value is ____________.

1.worse.

2.better

3.the best

4.equal

Posted Date:-2022-01-06 00:20:14


Question:
 lndustrial Development Bank of India is

1.Wholly-owned Government of India undertaking

2.Wholly-owned subsidiary of Reserve Bank of India

3.A corporation and owned by the Government of India and public sector banks

4.Public Limited Company

Posted Date:-2022-01-05 22:58:35


Question:
 Medium-term notes (MTNs) have maturities that range up to

1.one year (but no more)

2. two years (but no more).

3. ten years (but no more)

4.thirty years (or more)

Posted Date:-2022-01-05 22:23:18


Question:
 The financial institute IFCI established in

1. 1947

2.1948

3.1949

4.1950

Posted Date:-2022-01-05 23:02:33


Question:
 The formula for cost of debt is __________.

1. kd=(1/2+f-p)/f+p

2.f+p

3. f-P

4. f*p

Posted Date:-2022-01-06 01:10:36


Question:
A demerit of IRR method is that it does not distinguish between ____________.

1. lending & borrowing

2.discounting & non- discounting

3.cash flow & non- cash flow

4. inflow & outflow.

Posted Date:-2022-01-06 00:23:25


Question:
A way to analyze whether debt or lease financing would be preferable is to:

1.compare the net present values under each alternative, using the cost of capital as the discount rate.

2.compare the net present values under each alternative, using the after-tax cost of borrowing as the discount rate.

3.compare the payback periods for each alternative.

4.compare the effective interest costs involved for each alternative

Posted Date:-2022-01-05 22:09:12


Question:
Beta measures the ____________.

1. A. Financial risk.

2.Investment risk rate

3. Market risk

4.Market and finance risk.

Posted Date:-2022-01-05 22:20:22


Question:
Capital budgeting decisions in India cannot be reversed due to ____.

1.economic conditions.

2.ill-organized market for second-hand capital goods

3.government regulations.

4.policy of the management

Posted Date:-2022-01-06 00:18:15


Question:
Capital budgeting is related to ____

1.long terms assets.

2.short term assets.

3. long terms and short terms assets

4.fixed assets.

Posted Date:-2022-01-05 22:07:59


Question:
Corporation is not a part of ____________finance .

1. Public.

2.Private

3. Public & private

4.Organization

Posted Date:-2022-01-05 23:25:37


Question:
Cost of retained earnings is equal to ____________.

1.Cost of equity.

2.Cost of debt.

3.Cost of term loans

4.Cost of bank loan.

Posted Date:-2022-01-05 22:19:23


Question:
Effective cost of debentures is ____________as compared to shares

1.higher

2.lower

3.equal

4.medium

Posted Date:-2022-01-05 23:10:04


Question:
Financial decisions involve ____________.

1. Investment, financing and dividend decisions.

2.Investment sales decisions.

3.Financing cash decisions

4.Investment dividend decisions.

Posted Date:-2022-01-05 22:13:59


Question:
Financial leverage is also known as ____________.

1. Trading on equity

2.Trading on debt.

3. Interest on equity.

4.Interest on debt.

Posted Date:-2022-01-05 22:57:12


Question:
Financial leverage measures ____________.

1.sensitivity of EBIT with respect of 1% change with respect to output

2.1% variation in the level of production .

3.C. sensitivity of EPS with respect to 1% change in level of EBIT

4. no change with EBIT and EPS.

Posted Date:-2022-01-05 22:43:32


Question:
Financial leverage measures ____________.

1.sensitivity of EBIT with respect of 1% change with respect to output

2.1% variation in the level of production .

3.C. sensitivity of EPS with respect to 1% change in level of EBIT

4. no change with EBIT and EPS.

Posted Date:-2022-01-05 22:43:42


Question:
Financial security with low degree risk and investment held by businesses is classified as

1.treasury bills

2.commercial paper

3. negotiable certificate of deposit

4.money market mutual funds

Posted Date:-2022-01-05 23:34:52


Question:
Fixed cost per unit ____________.

1.changes according to the volume of production

2.be flexible according to the rate of interest.

3.does not change with the volume of production

4.remains constant.

Posted Date:-2022-01-05 22:39:05


Question:
Future value interest factor takes ____________.

1.Compounding rate

2.Discounting rate

3.Inflation rate

4.Deflation rate

Posted Date:-2022-01-05 23:36:06


Question:
Future value interest factor takes ____________.

1.. Compounding rate

2.Discounting rate

3. Inflation rate

4. Deflation rate

Posted Date:-2022-01-05 23:33:39


Question:
Greater the size of a business unit ____ will be the requirements of working capital.

1. lower.

2.no change.

3.larger

4.fixed

Posted Date:-2022-01-06 00:38:23


Question:
Headquarter of ICICI Bank is located at:

1.. Mumbai

2.Hyderabad

3.Mysore

4.Bangalore

Posted Date:-2022-01-05 22:38:00


Question:
In his traditional role the finance manager is responsible for ______

1.arrange of utilization of funds.

2.arrangement of financial resources.

3.acquiring capital assets of the organization.

4.effective management of capital

Posted Date:-2022-01-05 22:05:50


Question:
In his traditional role the finance manager is responsible for ___________.

1.proper utilisation of funds

2. arrangement of financial resources

3.acquiring capital assets of the organization

4.Efficient management of capital

Posted Date:-2022-01-05 23:03:26


Question:
Market value of the shares are decided by ____________.

1. the respective companies.

2.the investment market

3.the government.

4. shareholders.

Posted Date:-2022-01-05 22:18:22


Question:
Net present value is a popular method which falls ____________.

1.Within non- discount cash flow method.

2.Within discount cash flow method

3. Equal Within non- discount cash flow method

4.No discount cash flow

Posted Date:-2022-01-06 00:22:18


Question:
Net working capital is the excess of current asset over ____________.

1.. Current liability.

2.Net liability.

3.Total payable.

4.Total liability.

Posted Date:-2022-01-06 00:24:29


Question:
Net working capital refers to.

1. total assets minus fixed assets

2.current assets minus current liabilities

3.current assets minus inventories

4.current assets.

Posted Date:-2022-01-06 00:25:31


Question:
Net working capital refers to.

1. total assets minus fixed assets

2.current assets minus current liabilities

3.current assets minus inventories

4.current assets.

Posted Date:-2022-01-06 00:36:42


Question:
Offering cash discount to customers result is ____________.

1.reducing the average collection period.

2.increasing the average collection period

3.increasing sales

4.decreasing sales.

Posted Date:-2022-01-06 01:35:31


Question:
Operating incomes and the discount rate of a particular risk class are the 2 factors determining ____________.

1.Dependence hypothesis

2.Traditional view.

3.Modern view

4.Independence hypothesis.

Posted Date:-2022-01-05 23:40:23


Question:
Operating leverage = ______..

1. A. contribution less profit.

2.contribution less sales

3.contribution less total expenses

4.contribution less operating profit

Posted Date:-2022-01-05 23:00:30


Question:
Operating leverage measures ____________.

1. A. the business risk.

2.financial risk

3.both risks

4.production risk.

Posted Date:-2022-01-05 22:45:42


Question:
Operating leverage x financial leverage= _____.

1. composite leverage.

2.financial composite leverage.

3.operating composite leverage

4.fixed leverage

Posted Date:-2022-01-05 22:59:28


Question:
Ordering cost is the cost of ____________materials.

1. selling.

2.purchasing

3.stocking

4.financing

Posted Date:-2022-01-06 01:14:56


Question:
Ownership securities are represented by ____________.

1. securities.

2.equities

3.debt

4.debentures

Posted Date:-2022-01-05 23:13:13


Question:
Payback period is superior to other methods, if the objective of the investor is to ____________.

1.consider cash flow in its entirety

2.consider the present value of future cash flows

3.consider the liquidity

4.consider the inflows in its entirety.

Posted Date:-2022-01-06 00:19:11


Question:
Present value takes ____________.

1. A. Compounding rate.

2. Discounting rate.

3.Inflation rate

4.Deflation rate.

Posted Date:-2022-01-05 22:12:40


Question:
Shares having no face value are known as ____

1.no-par stock.

2. at par stock

3.equal stock

4.debt-equity stock.

Posted Date:-2022-01-05 23:04:47


Question:
The available capital funds are to be carefully allocated among competing projects by careful prioritization. This is called ____________.

1.capital positioning.

2.capital structuring

3. capital rationing.

4.capital budgeting.

Posted Date:-2022-01-06 00:17:03


Question:
The cash management refers to management of ___.

1.A. cash only

2.cash and bank balances

3.cash and near-cash assets

4.fixed assets.

Posted Date:-2022-01-06 01:34:16


Question:
The company must implement the bonus issues decision within ____________ of the director approval.

1.6 months.

2.3 months.

3.2 months.

4.1 month.

Posted Date:-2022-01-06 01:22:49


Question:
The decision to invest a substantial sum in any business venture expecting to earn a minimum return is called ____________.

1. working capital decision

2. an investment decision

3.a production decision.

4.a sales decision.

Posted Date:-2022-01-06 00:16:05


Question:
The expansion of CAPM is ____

1.Capital amount pricing model

2.Capital asset pricing model

3.Capital asset printing model.

4.a. Capital amount printing model.

Posted Date:-2022-01-05 22:21:35


Question:
The expansion of EAR is ____.

1. equivalent annual rate.

2.equivalent annuity rate

3. equally applied rate

4. equal advance rate

Posted Date:-2022-01-05 23:29:26


Question:
The first development financial institution in India that has got merged with a bank

1. IDBI

2.ICICI

3.UTI D

4.SFC

Posted Date:-2022-01-05 22:26:05


Question:
The fixed proportion of working capital should be generally financed from the ____ capital sources

1. fixed.

2.variable

3. semi-variable.

4.borrowed

Posted Date:-2022-01-06 00:39:49


Question:
The IDBI was established in

1.964

2.1965

3.1966

4.1967

Posted Date:-2022-01-05 23:01:33


Question:
The most appropriate dividend policy is the payment of ____________dividend per share consent

1.constant.

2.variable

3.higher

4.lower

Posted Date:-2022-01-06 01:25:00


Question:
The most difficult to calculate is ____________.

1.the cost of equity capital.

2. the cost of preferred capital.

3.the cost of retained earnings.

4.. the cost of equity and preference capital.

Posted Date:-2022-01-05 22:27:22


Question:
The policy concerning quarters of profit to be distributed as dividend is termed as ____________.

1.Profit policy.

2.Dividend policy

3.Credit policy.

4.Reserving policy.

Posted Date:-2022-01-06 01:16:15


Question:
The policy concerning quarters of profit to be distributed as dividend is termed as ____________.

1.Profit policy.

2.Dividend policy

3.Credit policy.

4.Reserving policy.

Posted Date:-2022-01-06 01:17:18


Question:
The primary goal of the financial management is ____

1.to maximize the return

2.to minimize the risk

3.to maximize the wealth of owners

4. to maximize profit..

Posted Date:-2022-01-05 22:06:56


Question:
The principal objective to form ICICI was:

1.To create a development financial institution

2.To create a financial institution for providing medium-term and long term project financing

3.Create a financial institution for providing medium-term and long term project financing to Indian businesses

4. All of the above areas

Posted Date:-2022-01-05 22:37:04


Question:
The principal objective was to create a development financial institution for providing ______project  financing to Indian businesses:

1.Medium Term

2.Long Term

3.Medium Term and Long Term

4.short term

Posted Date:-2022-01-05 22:40:28


Question:
The probability of bankrupt is higher ____________.

1. for a levered firm than an unlevered firm.

2.for a unlevered firm than an levered firm

3.only levered firm

4.only unlevered firm

Posted Date:-2022-01-05 23:42:39


Question:
The rate of return on investment ____ with the shortage of working capital

1.. falls.

2.going

3.constant

4.change

Posted Date:-2022-01-06 00:37:32


Question:
The required rate of return for an investment project should _____

1.leave the market price of the stock unchanged

2. increase the market price.

3. reduce the market price.

4.constant market price.

Posted Date:-2022-01-05 22:33:58


Question:
The type of lease that includes a third party, a lender, is called a(n)

1. sale and leaseback.

2.direct leasing arrangement.

3. leveraged lease.

4.operating lease.

Posted Date:-2022-01-05 22:10:15


Question:
The volume of sales is influenced by ____ of a firm

1. finance policy.

2. credit policy

3.profit policy

4. fund policy.

Posted Date:-2022-01-06 01:08:58


Question:
Traditional approach confines finance function only to ____________.

1.raising

2.mobilizing

3.utilizing

4.financing

Posted Date:-2022-01-05 22:16:37


Question:
Traditional theorists believe that.

1. there exists an optimal capital structure

2.no optimal capital structure

3.equal optimal capital structure

4.100% debt financial organizations

Posted Date:-2022-01-06 01:13:20


Question:
Variable cost per unit ____________.

1. varies with the level of output.

2.remains constant irrespective of the level of output.

3.changes with the growth of the firm.

4.does not change with the volume of production

Posted Date:-2022-01-05 22:41:53


Question:
Which of the following is/are assumption(s) underlying the Miller and Modigliani analysis?

1.Capital markets are perfect

2.Investors are assumed to be rational and behave accordingly

3.There is no corporate or personal income tax

4.All the above

Posted Date:-2022-01-06 01:33:15


Question:
Which one of the following is not a money market securities?

1.treasury bills

2.National savings certificate

3.Certificate of deposit

4.Commercial paper

Posted Date:-2022-01-05 23:28:35


Question:
Which one of the following is the main objective of Unit Trust of India?

1.To mobilize the savings of high-income groups.

2.To mobilize the savings to low and high-income groups.

3.To mobilize the savings of corporate.

4.To mobilize the savings of low and middle-income groups.

Posted Date:-2022-01-05 22:24:51


Question:
Working capital management is managing ____________.

1.short term assets and liabilities

2. long term assets

3. long terms liabilities

4.only short term assets

Posted Date:-2022-01-05 23:30:39


Question:
_________ dividend is the usual method of paying dividend .

1. Scrip.

2.Cash

3.Stock

4.Property

Posted Date:-2022-01-06 01:31:22


Question:
__________ are financial assets.

1.Bonds

2.Machines

3.Stocks

4.A and C

Posted Date:-2022-01-05 23:37:18


Question:
__________ dividend promises to pay shareholders at future date.

1.Scrip.

2.Cash

3.Stock

4.Property

Posted Date:-2022-01-06 01:27:59


More MCQS

  1. Business Studies-[Class 11-MCQ ]-Chapter 1- Nature and Purpose of Business
  2. Business Studies-[Class 11-MCQS ]-Chapter 2 Forms of Business Organisation
  3. Business Studies-[Class 11-MCQS ]-Chapter 3 Private, Public and Global Enterprises
  4. Business Studies-[Class 11-MCQS ]-Chapter 4 Business Services
  5. Business Studies-[Class 11-MCQS ]-Chapter 5 Emerging Modes of Business
  6. Business Studies-[Class 11-MCQS ]-Chapter 6 Social Responsibilities of Business
  7. Business Studies-[Class 11-MCQS ]-Chapter 7 Formation of a Company
  8. Business Studies-[Class 11-MCQS ]-Chapter 8 Sources of Business Finance
  9. Business Studies-[Class 11-MCQS ]-Chapter 9 Small Business
  10. Business Studies-[Class 11-MCQS ]-Chapter 10 Internal Trade
  11. Business Studies-[Class 11-MCQS ]-Chapter 11 International Business
  12. Business Studies-[Class 11-MCQS ]-Chapter 12 International Business
  13. Business Studies-[Class 12-MCQS ]-Chapter 1 Nature and Significance of Management
  14. Business Studies-[Class 12-MCQS ]-Chapter 2 Principles of Management
  15. Business Studies-[Class 12-MCQS ]-Chapter 3 Business Environment
  16. Business Studies-[Class 12-MCQS ]-Chapter 4 Planning
  17. Business Studies-[Class 12-MCQS ]-Chapter 5 Organising
  18. Business Studies-[Class 12-MCQS ]-Chapter 6 Staffing
  19. Business Studies-[Class 12-MCQS ]-Chapter 7 Directing
  20. Business Studies-[Class 12-MCQS ]-Chapter 9 Financial Management
  21. Business Studies-[Class 12-MCQS ]-Chapter 10 Financial Market
  22. Business Studies-[Class 12-MCQS ]-Chapter 11 Marketing
  23. Business Studies-[Class 12-MCQS ]-Chapter 12 Consumer Protection
  24. Financial Accounting MCQ Part – 2
  25. Financial Accounting MCQ Part – 3
  26. Business Economics MCQ Part 2
  27. Business Economics MCQ Questions and Answers Part – 3
  28. Corporate Finance MCQ Set 1
  29. Corporate Finance MCQ Set 2
  30. Direct Tax MCQ Set 2
  31. Business Information Systems MCQ Set 1
  32. Business Information Systems MCQ set 2
  33. Business Information Systems MCQ set 3
  34. Business Law MCQ Set 1
  35. Business Law MCQ Set 2
  36. Business Law Set 3
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