MCQOPTIONS
Saved Bookmarks
MCQOPTIONS
This section includes 657 Mcqs, each offering curated multiple-choice questions to sharpen your Testing Subject knowledge and support exam preparation. Choose a topic below to get started.
| 1. |
A technique that is used in comparative analysis of financial statement is |
| A. | graphical analysis |
| B. | preference analysis |
| C. | common size analysis |
| D. | returning analysis |
| Answer» D. returning analysis | |
| 2. |
The net income available to stockholders is $125 and total assets are $1,096 then return on common equity would be |
| A. | 0.00114 |
| B. | 0.114 |
| C. | 0.12 times |
| D. | 0.12 |
| Answer» C. 0.12 times | |
| 3. |
Markets in which outstanding securities are traded by investors are classified as%! |
| A. | primary markets |
| B. | secondary markets |
| C. | initial public offering market |
| D. | stock market |
| Answer» C. initial public offering market | |
| 4. |
Money lends to corporations by banks is classified as%! |
| A. | Eurodollar market deposits |
| B. | commercial loans |
| C. | consumer credit loans |
| D. | consumer credit loans |
| Answer» C. consumer credit loans | |
| 5. |
Transfer through institutions such as mutual funds or banks are classified as%! |
| A. | non-financial intermediary |
| B. | financial intermediary |
| C. | savers intermediary |
| D. | discounted intermediary |
| Answer» C. savers intermediary | |
| 6. |
In weighted average cost of capital, rising in interest rate leads to%! |
| A. | increase in cost of debt |
| B. | increase capital structure |
| C. | decrease in cost of debt |
| D. | decrease capital structure |
| Answer» B. increase capital structure | |
| 7. |
An annual rate of 16% if quoted by credit card issuer usually a bank is classified as%! |
| A. | loan rate of return |
| B. | local rate of return |
| C. | annual percentage rate |
| D. | annual rate of return |
| Answer» D. annual rate of return | |
| 8. |
If future return on common stock is 14% and rate on T-bonds is 5% then current market risk premium will be%! |
| A. | 19.00% |
| B. | 9.00% |
| C. | Rs 9 |
| D. | Rs 19 |
| Answer» C. Rs 9 | |
| 9. |
An attempt to make correction by adjusting historical beta to make it closer to an average beta is classified as%! |
| A. | adjusted stock |
| B. | adjusted beta |
| C. | adjusted coefficient |
| D. | adjusted risk |
| Answer» C. adjusted coefficient | |
| 10. |
Dividend per share is Rs 18 and sell it for Rs 122 and floatation cost is Rs 4 then component cost of preferred stock will be%! |
| A. | 15.25% |
| B. | 0.1525 times |
| C. | 15.25 |
| D. | 0.15% |
| Answer» B. 0.1525 times | |
| 11. |
Stock selling price is Rs 35, expected dividend is Rs 5 and expected growth rate is 8% then cost of common stock would be%! |
| A. | 40.00% |
| B. | 22.29% |
| C. | 14.28% |
| D. | 80.00% |
| Answer» C. 14.28% | |
| 12. |
Total common equity divided by common shares outstanding which is used to calculate%! |
| A. | book value of share |
| B. | market value of shares |
| C. | earning per share |
| D. | dividends per share |
| Answer» B. market value of shares | |
| 13. |
Rate charged by bank 12.5% on credit loans and 3% semi-annually on instalment loans is considered as%! |
| A. | periodic rate |
| B. | perpetuity rate of return |
| C. | annual rate |
| D. | annuity rate of return |
| Answer» B. perpetuity rate of return | |
| 14. |
Until word of preferred is used, an equity in balance sheet is treated as%! |
| A. | common equity |
| B. | preferred equity |
| C. | due equity |
| D. | common perpetuity |
| Answer» B. preferred equity | |
| 15. |
In calculation of time, value of money, ''N ''represents%! |
| A. | number of payment periods |
| B. | number of investment |
| C. | number of instalments |
| D. | number of premium received |
| Answer» B. number of investment | |
| 16. |
Net income and depreciation is Rs 313,650,000 and common shares outstanding are 55,000,000 then cash flow per share would be%! |
| A. | Rs 5.70 |
| B. | Rs 6.70 |
| C. | Rs 7.70 |
| D. | Rs 8.70 |
| Answer» B. Rs 6.70 | |
| 17. |
Procedure of finding present values in time value of money is classified as%! |
| A. | compounding |
| B. | discounting |
| C. | money value |
| D. | stock value |
| Answer» C. money value | |
| 18. |
In weighted average cost of capital, a company can affect its capital cost through%! |
| A. | policy of capital structure |
| B. | policy of dividends |
| C. | policy of investment |
| D. | all of above |
| Answer» E. | |
| 19. |
Price of stock that companies observe in financial markets is called%! |
| A. | market price |
| B. | intrinsic price |
| C. | extrinsic price |
| D. | fundamental price |
| Answer» B. intrinsic price | |
| 20. |
Financial markets include%! |
| A. | primary markets |
| B. | capital markets |
| C. | physical asset markets |
| D. | all of above |
| Answer» E. | |
| 21. |
Business owned by a single person in unincorporated way is called%! |
| A. | proprietorship |
| B. | personal business |
| C. | Private Corporation |
| D. | personal ownership |
| Answer» B. personal business | |
| 22. |
An unlimited liability for business debts and less capital for growth are limitations of%! |
| A. | proprietorship |
| B. | personal business |
| C. | Private Corporation |
| D. | personal ownership |
| Answer» B. personal business | |
| 23. |
In calculation of time value of money, 'PMT' represents%! |
| A. | present money tracking |
| B. | payment |
| C. | payment money tracking |
| D. | future money payment |
| Answer» C. payment money tracking | |
| 24. |
Lottery payoffs and payment for rental apartments are examples of%! |
| A. | lump sum amount |
| B. | deferred annuity |
| C. | annuity due |
| D. | payment fixed series |
| Answer» D. payment fixed series | |
| 25. |
A method of inventory recording which produces high inventories in balance sheet is classified as%! |
| A. | First out receivable |
| B. | First in first out |
| C. | Last in first out |
| D. | last out receivable |
| Answer» C. Last in first out | |
| 26. |
An interest rate which is quoted by brokers, banks and other financial institutions is classified as%! |
| A. | annuity rate |
| B. | perpetuity rate |
| C. | nominal rate |
| D. | external rate of return |
| Answer» D. external rate of return | |
| 27. |
A type of security payment in which payments are made at equal intervals of time and each payment amount is same is classified as%! |
| A. | fixed interval investment |
| B. | fixed payment investment |
| C. | annuity |
| D. | lump sum amount |
| Answer» D. lump sum amount | |
| 28. |
Economists consider effects of started project on other parts of company or on environment of company is called%! |
| A. | externalities |
| B. | foreign effects |
| C. | weighted effects |
| D. | opportunity effects |
| Answer» B. foreign effects | |
| 29. |
Nominal interest rates and nominal cash flows are usually reflected the%! |
| A. | inflation effects |
| B. | opportunity effects |
| C. | equity effects |
| D. | debt effects |
| Answer» B. opportunity effects | |
| 30. |
Weighted average cost of debt, preferred stock and common equity is classified as%! |
| A. | cost of salvage |
| B. | cost of interest |
| C. | cost of taxation |
| D. | cost of capital |
| Answer» E. | |
| 31. |
An investment outlay cash flow is Rs 2000, an operating cash flow is Rs 1500 and salvage cash flow is Rs 3000 then free cash flow would be%! |
| A. | Rs 500.00 |
| B. | Rs 2,500.00 |
| C. | Rs 650.00 |
| D. | Rs 6,500.00 |
| Answer» E. | |
| 32. |
A type of project whose cash flows would not depend on each other is classified as%! |
| A. | project net gain |
| B. | independent projects |
| C. | dependent projects |
| D. | net value projects |
| Answer» C. dependent projects | |
| 33. |
Project which is started by firm for increasing sales is classified as%! |
| A. | new expansion project |
| B. | old expanded project |
| C. | firm borrowing project |
| D. | product line selection |
| Answer» B. old expanded project | |
| 34. |
Free cash flow is Rs 15000, operating cash flow is Rs 3000, investment outlay cash flow is Rs 5000 then salvage cash flow will be%! |
| A. | Rs 17,000.00 |
| B. | -Rs 17,000.00 |
| C. | Rs 7,000.00 |
| D. | -Rs 7,000.00 |
| Answer» D. -Rs 7,000.00 | |
| 35. |
Long period of bond maturity leads to%! |
| A. | more price change |
| B. | stable prices |
| C. | standing prices |
| D. | mature prices |
| Answer» B. stable prices | |
| 36. |
Market required return is subtracted from risk free rate which is used to calculate%! |
| A. | quoted risk premium |
| B. | market risk premium |
| C. | portfolio risk premium |
| D. | unquoted risk premium |
| Answer» C. portfolio risk premium | |
| 37. |
Treasury yielded by bond is 7% and market required return is 13% then market risk premium will be%! |
| A. | 2.16% |
| B. | 20.00% |
| C. | 6.00% |
| D. | 0.53% |
| Answer» D. 0.53% | |
| 38. |
Probability distribution is classified as normal if expected return lies between%! |
| A. | ( + 1 and -1) |
| B. | ( + 2 and -2) |
| C. | ( + 3 and -3) |
| D. | ( + 4 and -4) |
| Answer» B. ( + 2 and -2) | |
| 39. |
Relationship between risk and required return is classified as%! |
| A. | security market line |
| B. | required return line |
| C. | market risk line |
| D. | risky return line |
| Answer» B. required return line | |
| 40. |
Type of premium asked by investors for bearing risk on average stock is classified as%! |
| A. | average premium |
| B. | market risk premium |
| C. | stock premium |
| D. | buying discount |
| Answer» C. stock premium | |
| 41. |
Range of probability distribution with 68.26% lies within%! |
| A. | (+ 3σ and -3σ) |
| B. | (+ 4σ and -4σ) |
| C. | (+ 1σ and -1σ) |
| D. | (+ 2σ and -2σ) |
| Answer» D. (+ 2≈ì√â and -2≈ì√â) | |
| 42. |
An amount invested is Rs 2000 and return is Rs 200 then rate of return would be%! |
| A. | 0.10% |
| B. | 10.00% |
| C. | Rs 1,800.00 |
| D. | Rs 2,200.00 |
| Answer» C. Rs 1,800.00 | |
| 43. |
According to probability distribution of rates of return, a close outcome to an expected value is shown by%! |
| A. | value distribution |
| B. | expected distribution |
| C. | more peaked distribution |
| D. | less peaked distribution |
| Answer» D. less peaked distribution | |
| 44. |
Stock in small companies, owned by few people but not actively traded is classified as%! |
| A. | closely held stock |
| B. | largely held stock |
| C. | attributed stock |
| D. | successful stock |
| Answer» B. largely held stock | |
| 45. |
Rate of return which considers riskiness and an available returns on investments is classified as%! |
| A. | constant dividend |
| B. | constant rate |
| C. | maximum rate of return |
| D. | minimum acceptable rate of return |
| Answer» E. | |
| 46. |
Standard deviation is 18% and coefficient of variation is 1.5% an expected rate of return will be%! |
| A. | 27.00% |
| B. | 12.00% |
| C. | 19.50% |
| D. | none of above |
| Answer» D. none of above | |
| 47. |
Stock with large amount of contribution of risk in a diversified portfolio is represented by%! |
| A. | high beta and standard deviation |
| B. | high beta, low standard deviation |
| C. | low beta, low standard deviation |
| D. | low beta, low variance |
| Answer» B. high beta, low standard deviation | |
| 48. |
Dividend present value for period of non-constant growth in addition with horizon value is used to calculate%! |
| A. | stock extrinsic value |
| B. | stock intrinsic value |
| C. | dividend intrinsic value |
| D. | stock intrinsic value |
| Answer» C. dividend intrinsic value | |
| 49. |
Operating leverage x financial leverage= _____.%! |
| A. | Combined Leverage |
| B. | Financial Combined Leverage |
| C. | Operating Combined Leverage |
| D. | Fixed leverage |
| Answer» D. Fixed leverage | |
| 50. |
Beta measures the ___________.%! |
| A. | Investment risk rate |
| B. | Financial risk |
| C. | Market risk |
| D. | Market and finance risk |
| Answer» D. Market and finance risk | |