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.
| 2101. |
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. | |
| 2102. |
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 | |
| 2103. |
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% | |
| 2104. |
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% | |
| 2105. |
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 | |
| 2106. |
An additional desired compensation by investors for assuming an additional risk on investment is classified as? |
| A. | risk premium |
| B. | investor premium |
| C. | additional premium |
| D. | assumed premium |
| Answer» B. investor premium | |
| 2107. |
Case in which average investors risk aversion is greater than slope of line and risk premium respectively is? |
| A. | steeper, greater |
| B. | steeper, smaller |
| C. | steeper, zero |
| D. | Both A and B |
| Answer» B. steeper, smaller | |
| 2108. |
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 | |
| 2109. |
Method of stock valuation which is multiple of earning per share, book value and net income is classified as? |
| A. | stock multiple analysis |
| B. | dividend multiple analysis |
| C. | market multiple analysis |
| D. | stock and multiple analysis |
| Answer» D. stock and multiple analysis | |
| 2110. |
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 | |
| 2111. |
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 | |
| 2112. |
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 | |
| 2113. |
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 | |
| 2114. |
Non-systematic risk is also known as_____________.? |
| A. | riskless |
| B. | market risk |
| C. | random risk |
| D. | company-specific risk |
| Answer» E. | |
| 2115. |
To whom does the Treasurer most likely report?? |
| A. | Chief Financial Officer |
| B. | Vice President of Operations |
| C. | Chief Executive Officer |
| D. | Board of Directors |
| Answer» B. Vice President of Operations | |
| 2116. |
According to Markowitz, an efficient portfolio is one that has the_________________.? |
| A. | largest expected return for the smallest level of risk |
| B. | largest expected return and zero risk |
| C. | largest expected return for a given level of risk |
| D. | smallest level of risk |
| Answer» D. smallest level of risk | |
| 2117. |
Offering cash discount to customers result in _______.? |
| A. | reducing the average collection period |
| B. | increasing the average collection period |
| C. | increasing sales |
| D. | decreasing sales |
| Answer» B. increasing the average collection period | |
| 2118. |
Dividend policy of a firm affects both the long-time financing and __________ wealth.? |
| A. | Owners |
| B. | Creditors |
| C. | Debtor |
| D. | Shareholders |
| Answer» E. | |
| 2119. |
The last step in fundamental analysis is__________.? |
| A. | economic analysis |
| B. | industry analysis |
| C. | company analysis |
| D. | technical analysis |
| Answer» E. | |
| 2120. |
The bonus issue is permitted to be made out of __________ and premium collected in cash.? |
| A. | free reserves |
| B. | free interest |
| C. | free bonus |
| D. | free cash dividend |
| Answer» B. free interest | |
| 2121. |
The sustainable growth rate of a firm can be calculated as the product of the_________. |
| A. | return on assets and the return on equity |
| B. | dividend payout ratio and leverage |
| C. | retention rate and the return on equity |
| D. | net profit margin and total sales |
| Answer» D. net profit margin and total sales | |
| 2122. |
Insufficient working capital results in __________. |
| A. | Block of cash |
| B. | Loosing interests |
| C. | Lack of production |
| D. | Lack of smooth flow of production |
| Answer» E. | |
| 2123. |
_______ uses a computer program in an attempt to imitate the brain in analysing securities. |
| A. | Decision trees |
| B. | Program trading |
| C. | Day traders |
| D. | Neural networks |
| Answer» E. | |
| 2124. |
Which of the following is/are the problem(s) encountered in financial statement analysis? |
| A. | Development of benchmarks |
| B. | Window dressing |
| C. | Interpretation of results |
| D. | All of the above |
| Answer» E. | |
| 2125. |
Collection of net income, amortization and depreciation is divided by common shares outstanding to calculate |
| A. | cash flow of financing activities |
| B. | cash flow per share |
| C. | cash flow of investment |
| D. | cash flow of operations |
| Answer» C. cash flow of investment | |
| 2126. |
Earnings that are not paid as dividends to stockholders and have cumulative amount are classified as |
| A. | non-paid earnings |
| B. | common earnings |
| C. | retained earnings |
| D. | preferred earnings |
| Answer» D. preferred earnings | |
| 2127. |
If payment of security is paid as Rs 100 at end of year for three years, it is an example of |
| A. | fixed payment investment |
| B. | lump sum amount |
| C. | fixed interval investment |
| D. | annuity |
| Answer» E. | |
| 2128. |
A company who issues bonds or stocks in result raised funds which finally |
| A. | increases liabilities |
| B. | increases equity |
| C. | increases cash |
| D. | decreases cash |
| Answer» D. decreases cash | |
| 2129. |
Student loans, mortgages and car loans are examples of |
| A. | lump sum amount |
| B. | deferred annuity |
| C. | annuity due |
| D. | payment fixed series |
| Answer» C. annuity due | |
| 2130. |
values of assets purchased or liabilities recorded as recorded by bookkeepers are considered as |
| A. | appreciated values |
| B. | depreciated values |
| C. | market values |
| D. | book values |
| Answer» E. | |
| 2131. |
Future value of interest if it is calculated two times a year can be a classified as |
| A. | semi-annual discounting |
| B. | annual discounting |
| C. | annual compounding |
| D. | semi-annual compounding |
| Answer» E. | |
| 2132. |
Total common equity Rs 996,000,000 and shares outstanding 50,000,000 then book value per share would be |
| A. | Rs 0.05 |
| B. | Rs 15.00 |
| C. | Rs 19.92 |
| D. | Rs 14.00 |
| Answer» D. Rs 14.00 | |
| 2133. |
Type of provision which allows an orderly retirement of an issued bond which is classified as |
| A. | whole call provision |
| B. | super fund provision |
| C. | floating fund provision |
| D. | sinking fund provision |
| Answer» E. | |
| 2134. |
An average inflation rate which is expected over life of security is classified as |
| A. | inflation premium |
| B. | off season premium |
| C. | nominal premium |
| D. | required premium |
| Answer» B. off season premium | |
| 2135. |
Indexed bonds that are issued by linking payments to inflation are classified as |
| A. | treasury inflation protected securities |
| B. | premium protected securities |
| C. | risk protected securities |
| D. | liquidity protected securities |
| Answer» B. premium protected securities | |
| 2136. |
Tax free bonds issue for welfare by industrial agencies or pollution control agencies are classified as |
| A. | agent bonds |
| B. | development bonds |
| C. | pollution control bonds |
| D. | Both B and C |
| Answer» E. | |
| 2137. |
An increasing in interest rate leads to decline in value of |
| A. | junk bonds |
| B. | outstanding bonds |
| C. | standing bonds |
| D. | premium bonds |
| Answer» C. standing bonds | |
| 2138. |
A bond whose price will rise above its face value is classified as |
| A. | premium face value |
| B. | premium bond |
| C. | premium stock |
| D. | premium warrants |
| Answer» C. premium stock | |
| 2139. |
If market interest rate rises above coupon rate then bond will be sold |
| A. | equal to return rate |
| B. | seasoned price |
| C. | below its par value |
| D. | above its par value |
| Answer» D. above its par value | |
| 2140. |
When price of bond is calculated below its par value, it is classified as |
| A. | classified bond |
| B. | discount bond |
| C. | compound bond |
| D. | consideration earning |
| Answer» C. compound bond | |
| 2141. |
The return component that gives periodic cash flows to the investor is known as the______________. |
| A. | capital gain |
| B. | interest rate |
| C. | yield |
| D. | unrealized gain. |
| Answer» D. unrealized gain. | |
| 2142. |
The expansion of EAR is? |
| A. | equivalent annual rate |
| B. | equivalent annuity rate |
| C. | equally applied rate |
| D. | equal advance rate |
| Answer» B. equivalent annuity rate | |
| 2143. |
The cost of capital of a firm is ______________. |
| A. | The dividend paid on the equity capital |
| B. | The weighted average of the cost of various long-term and short-term sources of finance |
| C. | The average rate of return it must earn on its investments to satisfy the various investors |
| D. | The minimum rate of return it must earn on its investments to keep its investors satisfied |
| Answer» E. | |
| 2144. |
Which of the following statement is true if the Net Present Value (NPV) of a positive? |
| A. | The IRR must be greater than 0. |
| B. | The discount rate exceeds the cost of capital. |
| C. | The profitability index equals 1 |
| D. | Accepting the project has an indeterminate effect on shareholders |
| Answer» B. The discount rate exceeds the cost of capital. | |
| 2145. |
The Debt-Equity ratio of a Company_______________. |
| A. | Measure its financial leverage |
| B. | Does not affect the Earnings per share |
| C. | Affects the dividend decision of the company |
| D. | None of the above. |
| Answer» B. Does not affect the Earnings per share | |
| 2146. |
Political stability is the major factor concerning_______________. |
| A. | exchange risk |
| B. | systematic risk |
| C. | non-systematic risk |
| D. | country risk |
| Answer» E. | |
| 2147. |
Which of the following is an argument for the relevance of dividends? |
| A. | Informational content |
| B. | Reduction of uncertainty |
| C. | Some investors' preference for current income |
| D. | All of the above. |
| Answer» E. | |
| 2148. |
Financial analysts, working capital means the same thing as __________. |
| A. | total assets |
| B. | fixed assets |
| C. | current assets |
| D. | current assets minus current Liabilities |
| Answer» E. | |
| 2149. |
Accounts payable, accruals and notes payables are listed on balance sheet as |
| A. | accrued liabilities |
| B. | current liabilities |
| C. | accumulated liabilities |
| D. | non-current liabilities |
| Answer» C. accumulated liabilities | |
| 2150. |
Intangible assets such as copyrights, trademarks and patents are applicable for |
| A. | depreciation |
| B. | amortization |
| C. | stock amortization |
| D. | perishable assets |
| Answer» C. stock amortization | |