MCQOPTIONS
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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. |
The volume of sales is influenced by ____ of a firm. |
| A. | inance policy |
| B. | redit policy |
| C. | rofit policy |
| D. | und policy |
| Answer» C. rofit policy | |
| 2. |
Which of the following is true regarding the expected return of a portfolio? |
| A. | t is a weighted average only for stock portfolios |
| B. | t can only be positive |
| C. | t can never be above the highest individual return |
| D. | ll of the above are true |
| Answer» D. ll of the above are true | |
| 3. |
Greater the size of a business unit ________ will be the requirements of working capital. |
| A. | arger |
| B. | ower |
| C. | o change |
| D. | ixed |
| Answer» B. ower | |
| 4. |
Portfolio weights are found by_________________. |
| A. | ividing standard deviation by expected value |
| B. | alculating the percentage each asset is to the total portfolio value |
| C. | alculating the return of each asset to total portfolio return |
| D. | ividing expected value by the standard deviation |
| Answer» C. alculating the return of each asset to total portfolio return | |
| 5. |
The rate of return on investment ____ with the shortage of working capital. |
| A. | alls |
| B. | oing |
| C. | onstant |
| D. | hange |
| Answer» B. oing | |
| 6. |
A computerized trading network that matches buy and sell orders electronically entered by customers is a___________. |
| A. | ational markets system |
| B. | lectronic communications networks |
| C. | nternet investment service |
| D. | lobal investment network. |
| Answer» C. nternet investment service | |
| 7. |
According to traditional approach, the average cost of capital _______________. |
| A. | emains constant up to a degree of leverage and rises sharply thereafter with every increase in leverage |
| B. | ises constantly with increase in leverage |
| C. | ecrease up to certain point, remains unchanged for moderate increase in leverage and rises beyond a certain point |
| D. | ecrease at an increasing rate with increase in leverage |
| Answer» D. ecrease at an increasing rate with increase in leverage | |
| 8. |
A fixed rate of _________ is payable on debentures |
| A. | ividend |
| B. | ommission |
| C. | nterest |
| D. | rokerage |
| Answer» D. rokerage | |
| 9. |
When most people refer to the mean, they are referring to the______________. |
| A. | edian |
| B. | rithmetic mean |
| C. | eometric mean |
| D. | umulative mean |
| Answer» C. eometric mean | |
| 10. |
A major difference between real and nominal returns is that_______________. |
| A. | eal returns adjust for inflation and nominal returns do not |
| B. | eal returns use actual cash flows and nominal returns use expected cash flows |
| C. | eal returns adjust for commissions and nominal returns do not |
| D. | eal returns show the highest possible return and nominal returns show the lowest possible return |
| Answer» B. eal returns use actual cash flows and nominal returns use expected cash flows | |
| 11. |
Net present value is a popular method which falls |
| A. | ith in non- discount cash flow method |
| B. | ith in discount cash flow method |
| C. | qual With in non- discount cash flow method |
| D. | o discount cash flow |
| Answer» C. qual With in non- discount cash flow method | |
| 12. |
Markets in which outstanding securities are traded by investors are classified as |
| A. | rimary markets |
| B. | econdary markets |
| C. | nitial public offering market |
| D. | tock market |
| Answer» C. nitial public offering market | |
| 13. |
Money lends to corporations by banks is classified as |
| A. | urodollar market deposits |
| B. | ommercial loans |
| C. | onsumer credit loans |
| D. | onsumer credit loans |
| Answer» C. onsumer credit loans | |
| 14. |
Transfer through institutions such as mutual funds or banks are classified as |
| A. | on-financial intermediary |
| B. | inancial intermediary |
| C. | avers intermediary |
| D. | iscounted intermediary |
| Answer» C. avers intermediary | |
| 15. |
Market where market makers keep record of stock of financial instruments is classified as |
| A. | tock market |
| B. | ealer market |
| C. | utcry auction system |
| D. | ace to face communication |
| Answer» C. utcry auction system | |
| 16. |
Federal Reserve policy and federal surplus or deficit of budget affect the |
| A. | ost of production |
| B. | ost of money |
| C. | pportunity cost |
| D. | nflation risk |
| Answer» C. pportunity cost | |
| 17. |
Bonds issue by corporations which are more risky than preferred stocks are classified as |
| A. | eases |
| B. | referred stocks |
| C. | ommon stocks |
| D. | orporate stocks |
| Answer» D. orporate stocks | |
| 18. |
Business owned by a single person in unincorporated way is called |
| A. | roprietorship |
| B. | ersonal business |
| C. | rivate Corporation |
| D. | ersonal ownership |
| Answer» B. ersonal business | |
| 19. |
An earning of business which is available for free distribution to all stockholders and creditors is classified as |
| A. | ree cash flows |
| B. | ree distribution |
| C. | vailable income |
| D. | ash income |
| Answer» B. ree distribution | |
| 20. |
Method of matching orders by posting orders of buying and selling is classified as |
| A. | lectronic communication network |
| B. | lectronic dealer network |
| C. | lectronic stock network |
| D. | lectronic order network |
| Answer» B. lectronic dealer network | |
| 21. |
Physical location exchange or telephone networks are types of |
| A. | ong-term markets |
| B. | econdary markets |
| C. | oney markets |
| D. | apital markets |
| Answer» C. oney markets | |
| 22. |
Financial markets include |
| A. | rimary markets |
| B. | apital markets |
| C. | hysical asset markets |
| D. | ll of above |
| Answer» E. | |
| 23. |
Firm's promise to pay and is backed or guaranteed by bank is classified as |
| A. | ustomer's acceptance |
| B. | anker's acceptance |
| C. | ederal acceptance |
| D. | reasury acceptance |
| Answer» C. ederal acceptance | |
| 24. |
Low default-risk security issued by financially secure firms is classified as |
| A. | .S treasury bills |
| B. | ommercial paper |
| C. | ertificate of deposit |
| D. | utual funds |
| Answer» C. ertificate of deposit | |
| 25. |
Markets which deals with high liquid and short term debt securities are classified as |
| A. | apital markets |
| B. | oney markets |
| C. | iquid markets |
| D. | hort-term markets |
| Answer» C. iquid markets | |
| 26. |
Price of stock that companies observe in financial markets is called |
| A. | arket price |
| B. | ntrinsic price |
| C. | xtrinsic price |
| D. | undamental price |
| Answer» B. ntrinsic price | |
| 27. |
Markets for products such as wheat, rice, cotton, real estate and autos dealing is classified as |
| A. | hysical asset markets |
| B. | ntangible assets |
| C. | ompetitive markets |
| D. | asy markets |
| Answer» B. ntangible assets | |
| 28. |
Collection of money from investors and spending money in other investment activities is classified as |
| A. | uture funds |
| B. | edge funds |
| C. | etirement funds |
| D. | ension funds |
| Answer» C. etirement funds | |
| 29. |
In financial markets, period of maturity within one to five years of financial instruments is classified as |
| A. | hort-term |
| B. | ong-term |
| C. | ntermediate term |
| D. | apital term |
| Answer» D. apital term | |
| 30. |
Ability to trade at net price very quickly is classified as |
| A. | riginal trading |
| B. | iquidity |
| C. | ffline trading |
| D. | ixed price trading |
| Answer» C. ffline trading | |
| 31. |
Members and employees of credit unions are loaned for |
| A. | ortgages |
| B. | ome improvement loans |
| C. | uto purchases |
| D. | ll of above |
| Answer» E. | |
| 32. |
Risk in which value of investment depends on what happens to foreign exchange rates is classified as |
| A. | referred risk |
| B. | xchange rate risk |
| C. | ountry risk |
| D. | oreign risk |
| Answer» C. ountry risk | |
| 33. |
Financial security in which there is no default risk and issues by U.S governments is classified as |
| A. | .S treasury bonds |
| B. | ortgages |
| C. | unicipal bonds |
| D. | orporate bonds |
| Answer» B. ortgages | |
| 34. |
Bonds issued to individuals by corporations are classified as |
| A. | unicipal bonds |
| B. | orporate bonds |
| C. | .S treasury bonds |
| D. | ortgages |
| Answer» C. .S treasury bonds | |
| 35. |
Limited partners in partnership business have |
| A. | o control |
| B. | hole control |
| C. | orporate authority |
| D. | eneral authority |
| Answer» B. hole control | |
| 36. |
Corporate governance charter of rules of behaving is applicable on |
| A. | ompetitors |
| B. | hareholders |
| C. | irectors |
| D. | ll of above |
| Answer» E. | |
| 37. |
Subset of primary market where firms go publicly by issuing stocks in financial markets is considered as |
| A. | nitial public offering market |
| B. | tock market |
| C. | ssuance market |
| D. | irst stock market |
| Answer» B. tock market | |
| 38. |
Condition in which company's imports are more than its exports is classified as |
| A. | oreign trade |
| B. | oreign trade deficits |
| C. | oreign trade surplus |
| D. | rade surplus |
| Answer» C. oreign trade surplus | |
| 39. |
In financial markets, period of maturity less than one year of financial instruments is classified as |
| A. | hort-term |
| B. | ong-term |
| C. | ntermediate term |
| D. | apital term |
| Answer» B. ong-term | |
| 40. |
Cost of money is affected by factors which includes |
| A. | roduction opportunities |
| B. | isk |
| C. | ll of above |
| D. | nflation |
| Answer» E. | |
| 41. |
Legal entity separation from its legal owners and managers with help of state laws is classified as |
| A. | ontrolled corporate business |
| B. | orporation |
| C. | imited corporate business |
| D. | nlimited corporate business |
| Answer» C. imited corporate business | |
| 42. |
Sales revenue Rs 90,000, operating taxes Rs 30,000 and operating capital Rs 15,000 then value of free cash flows will be |
| A. | s 45,000.00 |
| B. | s 13,500.00 |
| C. | s 65,000.00 |
| D. | s 75,000.00 |
| Answer» B. s 13,500.00 | |
| 43. |
Partners who are only liable for their own part of investment are considered as |
| A. | enture partners |
| B. | orporate partners |
| C. | imited partners |
| D. | eneral partners |
| Answer» D. eneral partners | |
| 44. |
Process of selling company stock at large to general public and get lending from banks is classified as an |
| A. | nitial public offering |
| B. | xternal public offering |
| C. | nternal public offering |
| D. | nprofessional offering |
| Answer» B. xternal public offering | |
| 45. |
Price for debt is called |
| A. | ebt rate |
| B. | nvestment return |
| C. | iscount rate |
| D. | nterest rate |
| Answer» E. | |
| 46. |
New York Stock Exchange and Nada stock market are classified as types of |
| A. | rimary stock market |
| B. | quity market |
| C. | econdary stock market |
| D. | ublic offering market |
| Answer» D. ublic offering market | |
| 47. |
Set of rules consisting of behavior towards its directors, creditors, shareholders, competitors and community is considered as |
| A. | gency governance |
| B. | iring governance |
| C. | orporate governance |
| D. | xternal governance |
| Answer» D. xternal governance | |
| 48. |
Notes, mortgages, bonds, stocks, treasury bills and consumer loans are classified as |
| A. | inancial instruments |
| B. | apital assets |
| C. | rimary assets |
| D. | ompetitive instruments |
| Answer» B. apital assets | |
| 49. |
Markets in which corporations raise capital for creating market transaction which are classified as |
| A. | ommercial markets |
| B. | esidential markets |
| C. | rimary markets |
| D. | onsumer credit loans |
| Answer» D. onsumer credit loans | |
| 50. |
Conglomerates that combine many financial institutions within a single corporation are classified as |
| A. | referred service corporations |
| B. | ommercial service corporations |
| C. | inancial services corporations |
| D. | ommon service corporations |
| Answer» D. ommon service corporations | |