MCQOPTIONS
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MCQOPTIONS
This section includes 2436 Mcqs, each offering curated multiple-choice questions to sharpen your Commerce knowledge and support exam preparation. Choose a topic below to get started.
| 801. |
Return on assets = 5.5%, Total assets Rs 3,000 and common equity Rs 1,050 then return on equity would be |
| A. | s 22,275.00 |
| B. | 5.71% |
| C. | .93% |
| D. | .925 times |
| Answer» C. .93% | |
| 802. |
Total assets divided common equity is a formula uses for calculating |
| A. | quity multiplier |
| B. | raphical multiplier |
| C. | urnover multiplier |
| D. | tock multiplier |
| Answer» B. raphical multiplier | |
| 803. |
Companies that help to set benchmarks are classified as |
| A. | ompetitive companies |
| B. | enchmark companies |
| C. | nalytical companies |
| D. | eturn companies |
| Answer» C. nalytical companies | |
| 804. |
Net income available to stockholders is Rs 150 and total assets are Rs 2,100 then return on total assets would be |
| A. | .07% |
| B. | .14% |
| C. | .05 times |
| D. | .15 times |
| Answer» C. .05 times | |
| 805. |
Ratios which relate firm's stock to its book value per share, cash flow and earnings are classified as |
| A. | eturn ratios |
| B. | arket value ratios |
| C. | arginal ratios |
| D. | quity ratios |
| Answer» C. arginal ratios | |
| 806. |
Company low earning power and high interest cost cause financial changes which have |
| A. | igh return on equity |
| B. | igh return on assets |
| C. | ow return on assets |
| D. | ow return on equity |
| Answer» C. ow return on assets | |
| 807. |
Profit margin multiply assets turnover multiply equity multiplier is used to calculate |
| A. | eturn on turnover |
| B. | eturn on stock |
| C. | eturn on assets |
| D. | eturn on equity |
| Answer» E. | |
| 808. |
An interest rate which is quoted by brokers, banks and other financial institutions is classified as |
| A. | nnuity rate |
| B. | erpetuity rate |
| C. | ominal rate |
| D. | xternal rate of return |
| Answer» D. xternal rate of return | |
| 809. |
If security pays Rs 5,000 in 20 years with 7% annual interest rate, PV of security by using formula is |
| A. | s 1,290.10 |
| B. | s 1,292.10 |
| C. | s 1,295.10 |
| D. | s 1,297.10 |
| Answer» C. s 1,295.10 | |
| 810. |
In situation of bankruptcy, stock which is recorded above common stock and below debt account is |
| A. | ebt liabilities |
| B. | referred stock |
| C. | ybrid stock |
| D. | ommon liabilities |
| Answer» C. ybrid stock | |
| 811. |
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. | ixed interval investment |
| B. | ixed payment investment |
| C. | nnuity |
| D. | ump sum amount |
| Answer» D. ump sum amount | |
| 812. |
Values recorded as determined in marketplace are considered as |
| A. | arket values |
| B. | ook values |
| C. | ppreciated values |
| D. | epreciated values |
| Answer» B. ook values | |
| 813. |
An inventory recording in balance sheet includes |
| A. | irst in first out |
| B. | ast in first out |
| C. | ast in last out |
| D. | oth A and B |
| Answer» E. | |
| 814. |
A method of inventory recording which produces high inventories in balance sheet is classified as |
| A. | irst out receivable |
| B. | irst in first out |
| C. | ast in first out |
| D. | ast out receivable |
| Answer» C. ast in first out | |
| 815. |
An interest rate is 5%, number of period are 3, and present value is Rs 100,and then future value will be |
| A. | 15.76 |
| B. | 05.00 |
| C. | 10.25 |
| D. | 13.56 |
| Answer» B. 05.00 | |
| 816. |
A loan that is repaid on monthly, quarterly and annual basis in equal payments is classified as |
| A. | mortized loan |
| B. | epreciated loan |
| C. | ppreciated loan |
| D. | epaid payments |
| Answer» B. epreciated loan | |
| 817. |
In calculation of time value of money, 'PMT' represents |
| A. | resent money tracking |
| B. | ayment |
| C. | ayment money tracking |
| D. | uture money payment |
| Answer» C. ayment money tracking | |
| 818. |
An interest rate which is paid by money borrower and charged by lender is considered as |
| A. | nnual rate |
| B. | eriodic rate |
| C. | erpetuity rate of return |
| D. | nnuity rate of return |
| Answer» C. erpetuity rate of return | |
| 819. |
Future value of interest if it is calculated once a year is classified as |
| A. | ne time compounding |
| B. | nnual compounding |
| C. | emi-annual compounding |
| D. | onthly compounding |
| Answer» C. emi-annual compounding | |
| 820. |
Lottery payoffs and payment for rental apartments are examples of |
| A. | ump sum amount |
| B. | eferred annuity |
| C. | nnuity due |
| D. | ayment fixed series |
| Answer» D. ayment fixed series | |
| 821. |
Net income is Rs 2250 and noncash charges are Rs 1150 then net cash flow would be |
| A. | s 1,100.00 |
| B. | s 3,400.00 |
| C. | s 2,200.00 |
| D. | s 3,500.00 |
| Answer» B. s 3,400.00 | |
| 822. |
A schedule which shows interest constitutes reduced principal and unpaid balance is considered as |
| A. | epaid schedule |
| B. | epreciated schedule |
| C. | mortization schedule |
| D. | ppreciated schedule |
| Answer» D. ppreciated schedule | |
| 823. |
Underlying all investments is the trade-off between_________. |
| A. | xpected return and actual return |
| B. | ow risk and high risk |
| C. | ctual return and high risk |
| D. | xpected return and risk |
| Answer» E. | |
| 824. |
Which of the following approaches advocates that the costs of equity capital and debt capital remain unaltered when the degree of leverage varies? |
| A. | et Income Approach |
| B. | raditional Approach |
| C. | odigliani-Miller Approach |
| D. | et operating Income |
| Answer» B. raditional Approach | |
| 825. |
Most financial advisors are registered with the Securities and Exchange Commission as_______________. |
| A. | egistered representatives |
| B. | egistered investor advisors |
| C. | egistered financial planners |
| D. | egistered securities consultants |
| Answer» D. egistered securities consultants | |
| 826. |
Under which of the following approaches cost of equity capital is assumed to be constant with the change in leverage? |
| A. | et income approach |
| B. | odigliani and Miller approach |
| C. | et operating income approach |
| D. | raditional approach |
| Answer» B. odigliani and Miller approach | |
| 827. |
Which of the following ratios is not affected by the financial structure and the tax rate of a company? |
| A. | et profit margin |
| B. | arning power |
| C. | arnings per share |
| D. | apitalization rate |
| Answer» D. apitalization rate | |
| 828. |
Investment professionals whose jobs may depend on their performance relative to the market are the______________. |
| A. | egistered representatives |
| B. | ecurity analysts |
| C. | nvestment bankers |
| D. | ortfolio managers |
| Answer» B. ecurity analysts | |
| 829. |
Which of the following factors influence(s) the capital structure of a business entity? |
| A. | argaining power with the suppliers |
| B. | emand for the product of the company |
| C. | echnology adopted |
| D. | dequate of the assets to meet any sudden spurt in demand |
| Answer» D. dequate of the assets to meet any sudden spurt in demand | |
| 830. |
Another name for stock brokers is______________. |
| A. | pecialists |
| B. | egistered representatives |
| C. | ecurity analysts |
| D. | ortfolio managers |
| Answer» C. ecurity analysts | |
| 831. |
Price per ratio is divided by cash flow per share ratio which is used for calculating |
| A. | ividend to stock ratio |
| B. | ales to growth ratio |
| C. | ash flow to price ratio |
| D. | rice to cash flow ratio |
| Answer» E. | |
| 832. |
Formula such as net income available for common stockholders divided by total assets is used to calculate |
| A. | eturn on total assets |
| B. | eturn on total equity |
| C. | eturn on debt |
| D. | eturn on sales |
| Answer» B. eturn on total equity | |
| 833. |
Profit margin = 4.5%, assets turnover = 2.2 times, equity multiplier = 2.7 times then return on equity will be |
| A. | 6.73% |
| B. | 5.73% |
| C. | .40% |
| D. | .00% |
| Answer» B. 5.73% | |
| 834. |
If the dispersion around a security's return is larger ____________. |
| A. | he expected return is smaller |
| B. | he standard deviation is smaller |
| C. | he stock's price is higher |
| D. | he security's risk is higher |
| Answer» E. | |
| 835. |
Which of the following is not a source of long-term finance? |
| A. | quity shares |
| B. | reference shares |
| C. | ommercial papers |
| D. | eserves and surplus |
| Answer» D. eserves and surplus | |
| 836. |
The expected return on an investment in stock is___________. |
| A. | he expected dividend payments |
| B. | he anticipated capital gains |
| C. | he sum of expected dividends and capital gains |
| D. | ess than the realized return |
| Answer» D. ess than the realized return | |
| 837. |
The method of raising equity capital from existing members by offering securities on pro rata basis is referred to as __________. |
| A. | ublic issue |
| B. | ight Issue |
| C. | rivate placement |
| D. | ought-Out-Deal |
| Answer» C. rivate placement | |
| 838. |
What are the factors which make debentures attractive to investors? |
| A. | hey enjoy a high order of priority in the event of liquidation |
| B. | table rate of return |
| C. | o risk |
| D. | ll of the above |
| Answer» E. | |
| 839. |
Diversification reduces _________. |
| A. | nterest rate risk |
| B. | arket risk |
| C. | nique risk |
| D. | nflation risk |
| Answer» D. nflation risk | |
| 840. |
Which of the following characteristics are true, with reference to preference capital? |
| A. | reference dividend is not tax deductible |
| B. | he claim of preference shareholders is prior to the claim of equity shareholders |
| C. | reference shareholders are not the owners of the concern |
| D. | ll of the above |
| Answer» E. | |
| 841. |
Asset allocation affects the investor's return by______________. |
| A. | ltering the returns on individual assets |
| B. | eighting the portfolio return by the allocation |
| C. | ssuring diversification |
| D. | ncreasing the investor's use of mutual funds |
| Answer» C. ssuring diversification | |
| 842. |
Walters model on dividend policy assumes that. |
| A. | he firm offers an increasing amount of dividend per share at a given level of price per share |
| B. | he firm has a finite life |
| C. | he cost of capital of the firm is variable |
| D. | qual to current assets plus current liabilities including bank borrowings |
| Answer» E. | |
| 843. |
_______ is example of financial intermediaries. |
| A. | ommercial banks |
| B. | nvestment bank |
| C. | nsurance companies |
| D. | ll of the above |
| Answer» E. | |
| 844. |
Operating Leverage is the response of changes in __________ |
| A. | BIT to the changes in sales |
| B. | PS to the changes in EBIT |
| C. | roduction to the changes in sales |
| D. | one of the above |
| Answer» B. PS to the changes in EBIT | |
| 845. |
The material wealth of a society is equal to the sum of _________. |
| A. | ll financial assets |
| B. | ll real assets |
| C. | ll financial and real assets |
| D. | ll physical assets |
| Answer» D. ll physical assets | |
| 846. |
Which of the following short term securities is inappropriate for an individual, desiring funds for financial emergencies? |
| A. | reasury bills |
| B. | ertificates of deposit |
| C. | inancial futures |
| D. | avings accounts |
| Answer» D. avings accounts | |
| 847. |
Investors seeking to avoid actively managing their portfolios will prefer which of the following assets? |
| A. | ommon stock |
| B. | ommercial bank deposits |
| C. | inancial futures |
| D. | eal estate |
| Answer» C. inancial futures | |
| 848. |
Which of the following is the assumption of the MM model on dividend policy? |
| A. | he firm is an all-equity firm |
| B. | he investments of the firm are financed solely by retained earnings |
| C. | he firm has an infinite life |
| D. | one of the above |
| Answer» D. one of the above | |
| 849. |
Investment bankers perform the following role ___________. |
| A. | arket new stock and bond issues for firms |
| B. | rovide advice to the firms as to market conditions, price, etc |
| C. | esign securities with desirable properties |
| D. | ll of the above |
| Answer» E. | |
| 850. |
Which of the following is not normally one of the reasons for a change in an investor's circumstances? |
| A. | hange in market conditions |
| B. | hange in legal considerations |
| C. | hange in time horizon |
| D. | hange in tax circumstances |
| Answer» C. hange in time horizon | |