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.
| 2001. |
_Size of firm and market or book ratio are variables which are related to$? |
| A. | premium returns |
| B. | unquoted returns |
| C. | quoted returns |
| D. | stock returns |
| Answer» E. | |
| 2002. |
_In portfolio, beta of individual security in portfolio represented as their weighted average is classified as$? |
| A. | average of portfolio |
| B. | beta of portfolio |
| C. | weighted portfolio |
| D. | collective stocks |
| Answer» C. weighted portfolio | |
| 2003. |
_A tighter probability distribution shows the$? |
| A. | higher risk |
| B. | lower risk |
| C. | expected risk |
| D. | peaked risk |
| Answer» C. expected risk | |
| 2004. |
_Standard deviation is divided by expected rate of return is used to calculate$? |
| A. | coefficient of variation |
| B. | coefficient of deviation |
| C. | coefficient of standard |
| D. | coefficient of return |
| Answer» B. coefficient of deviation | |
| 2005. |
_Market risk and diversifiable risk are two components of$? |
| A. | stock's risk |
| B. | portfolio risk |
| C. | expected return |
| D. | stock return |
| Answer» B. portfolio risk | |
| 2006. |
_When changes in patents and industry competition occur, required rate of return$? |
| A. | changes |
| B. | does not change |
| C. | becomes zero |
| D. | becomes one |
| Answer» C. becomes zero | |
| 2007. |
_Risk in average individual stock can be reduced by placing an individual stock in$? |
| A. | low risk portfolio |
| B. | diversified portfolio |
| C. | undiversified portfolio |
| D. | high risk portfolio |
| Answer» C. undiversified portfolio | |
| 2008. |
_Mostly in financials, risk of portfolio is smaller than that of assets$? |
| A. | mean |
| B. | weighted average |
| C. | mean correlation |
| D. | negative correlation |
| Answer» C. mean correlation | |
| 2009. |
Graph which is plotted for projected net present value and capital rates is called$? |
| A. | net loss profile |
| B. | net gain profile |
| C. | net future value profile |
| D. | net present value profile |
| Answer» E. | |
| 2010. |
Payback period in which an expected cash flows are discounted with help of project cost of capital is classified as$? |
| A. | discounted payback period |
| B. | discounted rate of return |
| C. | discounted cash flows |
| D. | discounted project cost |
| Answer» B. discounted rate of return | |
| 2011. |
Relationship between Economic Value Added (EVA) and Net Present Value (NPV) is considered as$? |
| A. | valued relationship |
| B. | economic relationship |
| C. | direct relationship |
| D. | inverse relationship |
| Answer» D. inverse relationship | |
| 2012. |
Other factors held constant, but lesser project liquidity is because of$? |
| A. | shorter payback period |
| B. | greater payback period |
| C. | less project return |
| D. | greater project return |
| Answer» C. less project return | |
| 2013. |
Cost of equity which is raised by reinvesting earnings internally must be higher than the$? |
| A. | cost of initial offering |
| B. | cost of new common equity |
| C. | cost of preferred equity |
| D. | cost of floatation |
| Answer» C. cost of preferred equity | |
| 2014. |
Risk free rate is subtracted from expected market return is considered as$? |
| A. | country risk |
| B. | diversifiable risk |
| C. | equity risk premium |
| D. | market risk premium |
| Answer» D. market risk premium | |
| 2015. |
Situation in which firm limits expenditures on capital is classified as$? |
| A. | optimal rationing |
| B. | capital rationing |
| C. | marginal rationing |
| D. | transaction rationing |
| Answer» C. marginal rationing | |
| 2016. |
Profitability index in capital budgeting is used for$? |
| A. | negative projects |
| B. | relative projects |
| C. | evaluate projects |
| D. | earned projects |
| Answer» D. earned projects | |
| 2017. |
Process in which managers of company identify projects to add value is classified as$? |
| A. | capital budgeting |
| B. | cost budgeting |
| C. | book value budgeting |
| D. | equity budgeting |
| Answer» B. cost budgeting | |
| 2018. |
In weighted average cost of capital, capital components are funds that usually offer by$? |
| A. | stock market |
| B. | investors |
| C. | capitalist |
| D. | exchange index |
| Answer» C. capitalist | |
| 2019. |
If two independent projects having hurdle rate then both projects should$? |
| A. | be accepted |
| B. | not be accepted |
| C. | have capital acceptance |
| D. | have return rate acceptance |
| Answer» B. not be accepted | |
| 2020. |
Cash flows occurring with more than one change in sign of cash flow are classified as$? |
| A. | non-normal cash flow |
| B. | normal cash flow |
| C. | normal costs |
| D. | non-normal costs |
| Answer» B. normal cash flow | |
| 2021. |
Historical growth rates, analysis forecasts and retention growth model are approaches to estimate$? |
| A. | present value of gain |
| B. | growth rate |
| C. | growth gain |
| D. | discounted gain |
| Answer» C. growth gain | |
| 2022. |
Value of stock is Rs 900 and required rate of return is 30% then preferred dividend will be$? |
| A. | Rs 270.00 |
| B. | Rs 27,000.00 |
| C. | Rs 90.00 |
| D. | Rs 90.00 |
| Answer» B. Rs 27,000.00 | |
| 2023. |
First step in calculating value of stock with non-constant growth rate is to$? |
| A. | estimate expected dividend |
| B. | actual expected dividend |
| C. | estimate number of share |
| D. | estimate intrinsic shares |
| Answer» B. actual expected dividend | |
| 2024. |
Expected capital gain is Rs 20 and expected final price is Rs 50 then original investment will be$? |
| A. | Rs 30.00 |
| B. | -Rs 30.00 |
| C. | Rs 70.00 |
| D. | -Rs 70.00 |
| Answer» B. -Rs 30.00 | |
| 2025. |
Constant growth rate is 8% and an expected dividend yield is 5.4% then expected rate of return would be$? |
| A. | -3.40% |
| B. | 3.40% |
| C. | 13.40% |
| D. | -13.40% |
| Answer» D. -13.40% | |
| 2026. |
Capital gain is Rs 3 and capital gains yield is 6% then beginning price will be$? |
| A. | Rs 18.00 |
| B. | Rs 36.00 |
| C. | Rs 50.00 |
| D. | Rs 55.00 |
| Answer» D. Rs 55.00 | |
| 2027. |
In expected rate of return for constant growth, an expected yield on capital must be$? |
| A. | equal to zero |
| B. | greater than expected growth rate |
| C. | less than expected growth rate |
| D. | equal to expected growth rate |
| Answer» E. | |
| 2028. |
Preferred dividend is divided for required rate of return to calculate$? |
| A. | value of number of shares |
| B. | value of equity |
| C. | value of preferred stock |
| D. | value of common stock |
| Answer» D. value of common stock | |
| 2029. |
An expected dividend yield is 5.5% and expected rate of return is 11.5% then constant growth rate would be$? |
| A. | 2.09% |
| B. | -6.00% |
| C. | 17.50% |
| D. | 6.00% |
| Answer» E. | |
| 2030. |
If an expected final stock price is Rs 85 and an original investment is Rs 70 then value of expected capital gain would be$? |
| A. | Rs 15.00 |
| B. | -Rs 15.00 |
| C. | Rs 155.00 |
| D. | -Rs 155.00 |
| Answer» B. -Rs 15.00 | |
| 2031. |
Dividend yield is 25% and current price is Rs 40 then dividend yield will be$? |
| A. | Rs 50.00 |
| B. | Rs 10.00 |
| C. | Rs 65.00 |
| D. | Rs 15.00 |
| Answer» C. Rs 65.00 | |
| 2032. |
In expected rate of return for constant growth, an expected total rate of return must be$? |
| A. | less than expected yield on dividend |
| B. | greater than expected yield on dividend |
| C. | equal to expected yield on dividend |
| D. | equal to one |
| Answer» D. equal to one | |
| 2033. |
Constant growth rate is 6.5% and an expected dividend yield is 3.4% then an expected rate of return would be$? |
| A. | 9.90% |
| B. | 10.00% |
| C. | 3.10% |
| D. | 19.12% |
| Answer» B. 10.00% | |
| 2034. |
Constant growth model would not be used in condition if growth rate is$? |
| A. | greater than dividend paid |
| B. | equal to realized rate of return |
| C. | less than realized rate of return |
| D. | greater than realized rate of return |
| Answer» E. | |
| 2035. |
Third factor in Fama French three factor model is ratio which is classified as$? |
| A. | book to market ratio |
| B. | market to book ratio |
| C. | company to industry ratio |
| D. | stock to portfolio ratio |
| Answer» C. company to industry ratio | |
| 2036. |
A technique of lowering risk for multinational companies and globally designed portfolios is classified as$? |
| A. | national diversification |
| B. | behavioral diversification |
| C. | global diversification |
| D. | behavioral finance |
| Answer» D. behavioral finance | |
| 2037. |
Type of risk in which beta is equal to one is classified as$? |
| A. | multiple risk stock |
| B. | varied risk stock |
| C. | total risk stock |
| D. | average risk stock |
| Answer» E. | |
| 2038. |
Risk on a stock portfolio which cannot be eliminated or reduced by placing it in diversified portfolio is classified as$? |
| A. | diversifiable risk |
| B. | market risk |
| C. | stock risk |
| D. | portfolio risk |
| Answer» C. stock risk | |
| 2039. |
Yield on bond is 7% and market required return is 14% then market risk premium would be$? |
| A. | 2.00% |
| B. | 21.00% |
| C. | 0.50% |
| D. | 7.00% |
| Answer» E. | |
| 2040. |
Preferred dividend is divided by preferred stock price multiply by (1-floatation cost) is used to calculate$? |
| A. | transaction cost of preferred stock |
| B. | financing of preferred stock |
| C. | weighted cost of capital |
| D. | component cost of preferred stock |
| Answer» E. | |
| 2041. |
Cost of common stock is 13% and bond risk premium is 5% then bond yield would be$? |
| A. | 20.00% |
| B. | 2.60% |
| C. | 8.00% |
| D. | 18.00% |
| Answer» D. 18.00% | |
| 2042. |
Interest rate is 12% and tax savings (1-0.40) then after-tax component cost of debt will be$? |
| A. | 7.20% |
| B. | 7.40% |
| C. | 17.14% |
| D. | 17.24% |
| Answer» B. 7.40% | |
| 2043. |
Bond risk premium is added in to bond yield to calculate the$? |
| A. | cost of American option |
| B. | cost of European option |
| C. | cost of common stock |
| D. | cost of preferred stock |
| Answer» D. cost of preferred stock | |
| 2044. |
Interest rates, tax rates and market risk premium are factors which an/a$? |
| A. | industry cannot control |
| B. | industry cannot control |
| C. | firm must control |
| D. | firm cannot control |
| Answer» E. | |
| 2045. |
In financial markets, period of maturity within one to five years of financial instruments is classified as$? |
| A. | short-term |
| B. | long-term |
| C. | intermediate term |
| D. | capital term |
| Answer» D. capital term | |
| 2046. |
Markets which deals with high liquid and short term debt securities are classified as$? |
| A. | capital markets |
| B. | money markets |
| C. | liquid markets |
| D. | short-term markets |
| Answer» C. liquid markets | |
| 2047. |
Physical location exchange or telephone networks are types of$? |
| A. | long-term markets |
| B. | secondary markets |
| C. | money markets |
| D. | capital markets |
| Answer» C. money markets | |
| 2048. |
Bonds issue by corporations which are more risky than preferred stocks are classified as$? |
| A. | leases |
| B. | preferred stocks |
| C. | common stocks |
| D. | corporate stocks |
| Answer» D. corporate stocks | |
| 2049. |
Capital gains yield is multiplied for beginning price to calculate$? |
| A. | capital gain |
| B. | growth gain |
| C. | regular yield |
| D. | variable yield |
| Answer» B. growth gain | |
| 2050. |
Process in which stockholders transfer right to vote to any other person is classified as$? |
| A. | proxy |
| B. | transfer process |
| C. | voting process |
| D. | assigning right process |
| Answer» B. transfer process | |