MCQ Corporate Finance

20 Questions | Total Attempts: 4973

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MCQ Corporate Finance

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Questions and Answers
  • 1. 
    At the interest rate of 15%, the 2 years discounting factor will be
    • A. 

      0.7561

    • B. 

      0.8697

    • C. 

      0.9651

    • D. 

      1.1225

  • 2. 
    The firm's investment decision is also called as the
    • A. 

      Financing Decision

    • B. 

      Capital Budgeting Decision

    • C. 

      Liquidity Decision

    • D. 

      Dividend Decision

  • 3. 
    As far as their value is concerned, the top priority group in company should be
    • A. 

      Shareholders

    • B. 

      Employees

    • C. 

      Board of Directors

    • D. 

      Governing Body

  • 4. 
    Normally the Cost of Capital should be -----
    • A. 

      Equal to IRR

    • B. 

      Less than IRR

    • C. 

      More than IRR

    • D. 

      Corresponding to IRR

  • 5. 
    Modigliani Miller Approach highlights the following aspect in dividend decisions
    • A. 

      Rate of Dividend

    • B. 

      Company tendency to retain earnings

    • C. 

      Zero impact of market prices of shares

    • D. 

      Shareholders' expectations

  • 6. 
    From the following, which is not the direct middleman in the capital market ?
    • A. 

      Rating Agencies

    • B. 

      Broker

    • C. 

      Banker

    • D. 

      Trustee

  • 7. 
    The term Over or Under Subscription is used in case of ---
    • A. 

      Bank Financing

    • B. 

      Public Issue

    • C. 

      Non Performing Assets

    • D. 

      Syndicate Financing

  • 8. 
    If the present value of cash flow X is Rs.200 & that of Y is Rs.150, the combined present value of cash flows will be --
    • A. 

      Rs.200

    • B. 

      Rs.150

    • C. 

      Rs.50

    • D. 

      Rs.350

  • 9. 
    Limited Liability is main feature of ---
    • A. 

      Sole Proprietorship

    • B. 

      Partnership

    • C. 

      Corporations

    • D. 

      N G O

  • 10. 
    The Steel Authority Of India sold out 5% of their stake to private players & raised $ 275 Million. This is popularly called as  --
    • A. 

      Business Strategy

    • B. 

      Business Valuation

    • C. 

      Disinvestment

    • D. 

      Foreign Direct Investment

  • 11. 
    A formula of X-Y/Z is used for calculating the -- of Business Assets
    • A. 

      Book Value

    • B. 

      Market Value

    • C. 

      Fair Value

    • D. 

      Liquidation Value

  • 12. 
    In ascertaining the EVA, the following component is to be considered.
    • A. 

      Earnings Before Tax

    • B. 

      Earnings After Tax & Interest

    • C. 

      Earnings after Tax excluding Interest

    • D. 

      Profits After Taxes

  • 13. 
    Annuity is defined as -
    • A. 

      Equal cash flows at equal intervals of time at a specific period

    • B. 

      Equal cash flows at equal intervals of time forever

    • C. 

      Unequal cash flows at equal intervals of time forever

    • D. 

      Unequal cash flows at equal intervals of time for specific period

  • 14. 
    The creditors of company are usually interested in observing the --
    • A. 

      Liquidity Ratio

    • B. 

      Solvency Ratio

    • C. 

      Profitability Ratio

    • D. 

      Turnover Ration

  • 15. 
    From the following, which is not considered as the financial asset ?
    • A. 

      Common Stock

    • B. 

      Patents

    • C. 

      Bonds

    • D. 

      Preferred Stock

  • 16. 
    Short Term Period in business is generally ..
    • A. 

      Less than 3 Months

    • B. 

      Less than 6 Months

    • C. 

      Less than a year

    • D. 

      Less than 5 years

  • 17. 
    The Finance Controller is responsible for the following except
    • A. 

      Preparation & interpretation of Financial Statements

    • B. 

      Internal Auditing

    • C. 

      Tax Management

    • D. 

      Raising of Funds for business

  • 18. 
    Financial leverage of the company is ascertaining by using..
    • A. 

      Liquidity Ratio

    • B. 

      Long Term Solvency Ratio

    • C. 

      Turnover Ratio

    • D. 

      Profitability Ratio

  • 19. 
    Quick Ratio indicates the ..
    • A. 

      Profitability of company

    • B. 

      Cash position of company

    • C. 

      Capital Structure of company

    • D. 

      None of the above

  • 20. 
    Any speculative stock having high probability in future is seem to be  ---- today.
    • A. 

      High, Negative & Under-priced

    • B. 

      High, Negative & Overpriced

    • C. 

      High, Positive & Overpriced

    • D. 

      Low, Negative & Overpriced

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