MBA/MBA Financial Management MCQ Set 7 Sample Test,Sample questions

Question:
A Current Ratio of Less than One means:

1.Current Liabilities < Current Assets

2.Fixed Assets > Current Assets

3.Current Assets < Current Liabilities

4.Share Capital > Current Assets


Question:
A firm has inventory turnover of 6 and cost of goods sold is 7,50,000. With better inventory management, the inventory turnover is increased to 10. This would result in:

1.Increase in inventory by 50,000

2.Decrease in inventory by. 50,000

3.Decrease in cost of goods sold

4.Increase in cost of goods sold


Question:
ABC Analysis is useful for analyzing the inventories:

1.Based on their Quality

2.Based on their Usage and value

3.Based on Physical Volume

4.All of the above


Question:
Advantage of Debt financing is

1.Interest is tax-deductible

2.It reduces WACC

3.Does not dilute owners control

4.All of the above


Question:
Business risk can be measured by:

1.Financial leverage

2.Operating leverage

3.Combined leverage

4.None of the above


Question:
Cash Discount term 3/15, net 40 means

1.3% Discount if payment in 15 days, otherwise full payment in 40 days

2.15% Discount if payment in 3 days, otherwise full payment 40 days

3.3% Interest if payment made in 40 days and 15%,interest thereafter

4.None of the above


Question:
Commercial paper are generally issued at a pries

1.Equal to face value

2.More than face value

3.Less than face value

4.Equal to redemption value


Question:
Cost Capital for Equity Share Capital does not imply that:

1.Market Price is equal to Book Value of share

2.Shareholders are ready to subscribe to right issue

3.Market Price is more than Issue Price

4.AC of the three above


Question:
Cost of not carrying sufficient inventory is known as

1.Carrying Cost

2.Holding Cost

3.Total Cost

4.Stock-out Cost


Question:
Credit Policy of a firm should involve a trade-off between increased

1.Sales and Increased Profit

2.Profit and Increased Costs of Receivables

3.Sales and Cost of goods sold

4.None of the above


Question:
Dividend declared by a company must be paid in

1.20 days

2.30 days

3.32 days

4.42 days


Question:
Dividend irrelevance argument of MM Model is based on:

1.Issue of Debentures

2.Issue of Bonus Share

3.Arbitrage

4.Hedging


Question:
From the point of view of the lessee, a lease is a:

1.Working capital decision

2.Financing decision

3.Buy or make decision

4.Investment decision


Question:
If a firm has no debt, which one is correct?

1.OL is one

2.FL is one

3.OL is zero

4.FL is zero


Question:
If a firm has no Preference share capital, Financial Break even level is defined as equal to -

1.EBIT

2.Interest liability

3.Equity Dividend

4.Tax Liability


Question:
If the average balance of debtors has increased, which of the following might not show a change in general?

1.Total Sales

2.Average Payables

3.Current Ratio

4.Bad Debt loss


Question:
In case of Gordon's Model, the MP for zero payout is zero. It means that

1.Shares are not traded

2.Shares available free of cost

3.Investors are not ready to offer any price

4.None of the above


Question:
In case of Net Income Approach, the Cost of equity is:

1.Constant

2.Increasing

3.Decreasing

4.None of the above


Question:
In India, Dividend Distribution tax is paid on

1.Equity Share

2.Preference Share

3.Debenture

4.Both (a) and (b)


Question:
In Inventory Turnover calculation, what is taken in the numerator?

1.Sales

2.Cost of Goods Sold

3.Opening Stock

4.Closing Stock


Question:
Inventory holding cost may include

1.Material Purchase Cost

2.Penalty charge for default

3.Interest on loan

4.None of the above


Question:
Nominal Rate ÷ Inflation Rate

1.(1 + Inf. Rate) (1 + Money D Rate)-1

2.(1 + Money D Rate) + (1 + Inf. Rate)-1

3.(1 + Money D Rate) 4- (1 + Inf. Rate)-1

4.(1 + Money D Rate) - (1 + Inf. Rate)-1


Question:
Operating leverage arises because of:

1.Fixed Cost of Production

2.Fixed Interest Cost

3.Variable Cost

4.None of the above


Question:
Real rate of return is equal to:

1.Nominal Rate × Inflation Rate

2.Nominal Rate ÷ Inflation Rate

3.Nominal Rate - Inflation Rate

4.Nominal Rate + Inflation Rate


Question:
Receivables Management deals with

1.Receipts of raw materials

2.Debtors collection

3.Creditors Management

4.Inventory Management


Question:
Risk-aversion of an investor can be measured by

1.Market Rate of Return

2.Risk-free Rate of Return

3.Portfolio Return

4.None of the above.


Question:
Savings in respect of a cost is treated in capital budgeting as:

1.An Inflow

2.An Outflow

3.Nil

4.None of the above


Question:
Securitization is related to conversion of

1.Receivables

2.Stock

3.Investments

4.Creditors


Question:
Stock split is a form of

1.Dividend Payment

2.Bonus Issue

3.Financial restructuring

4.Dividend in kind


Question:
The Transaction Motive for holding cash is for

1.Safety Cushion

2.Daily Operations

3.Purchase of Assets

4.Payment of Dividends


Question:
Under income-tax provisions, depreciation on lease asset is allowed to

1.Lessor

2.Lessee

3.Any of the two

4.None of the two


Question:
Use of safety stock by a firm would

1.Increase Inventory Cost

2.Decrease Inventory Cost

3.No effect on cost

4.None of the above


Question:
Which is the most expensive source of funds?

1.New Equity Shares

2.New Preference Shares

3.New Debts

4.Retained Earnings


Question:
Which of the following assumes constant kd and ke?

1.Net Income Approach

2.Net Operating Income Approach

3.Traditional Approach

4.MM Model


Question:
Which of the following assumes constant kd and ke?

1.Net Income Approach

2.Net Operating Income Approach

3.Traditional Approach

4.MM Model


Question:
Which of the following generally not result in increase in total dividend liability ?

1.Share-split

2.Right Issue

3.Bonus Issue

4.All of the above


Question:
Which of the following is a liability of a bank?

1.Treasury Bills

2.Commercial papers

3.Certificate of Deposits

4.Junk Bonds


Question:
Which of the following is a measure of Debt Service capacity of a firm?

1.Current Ratio

2.Acid Test Ratio

3.Interest Coverage Ratio

4.Debtors Turnover


Question:
Which of the following is incorrect for NOI?

1.k0 is constant

2.kd is constant

3.ke is constant

4.kd & k0 are constant


Question:
Which of the following is not a benefit of carrying inventories

1.Reduction in ordering cost

2.Avoiding lost sales

3.Reducing carrying cost

4.Avoiding Production Shortages


Question:
Which of the following is not a motive to hold cash?

1.Transactionary Motive

2.Pre-scautionary Motive

3.Captal Investment

4.None of the above


Question:
Which of the following is not a technique of receivables Management?

1.Funds Flow Analysis

2.Ageing Schedule

3.Days sales outstanding

4.Collection Matrix


Question:
Which of the following is not an element of credit policy?

1.Credit Terms

2.Collection Policy

3.Cash Discount Terms

4.Sales Price


Question:
Which of the following is not an objective of cash management ?

1.Maximization of cash balance

2.Minimization of cash balance

3.Optimization of cash balance

4.Zero cash balance


Question:
Which of the following is not considered by Miller-Orr Model?

1.Variability in cash requirement

2.Cost of transaction

3.Holding cost

4.Total annual requirement of cash


Question:
Which of the following is not considered in Lintner's Model ?

1.Dividend payout ratio

2.Current EPS

3.Speed of Adjustment

4.Preceding year EPS


Question:
Which of the following is not incorporated in Capital Budgeting?

1.Tax-Effect

2.Time Value of Money

3.Required Rate of Return

4.Rate of Cash Discount


Question:
Which of the following is not true for capital budgeting?

1.Sunk costs are ignored

2.Opportunity costs are excluded

3.Incremental cash flows are considered

4.Relevant cash flows are considered


Question:
Which one is true for Net Operating Income Approach?

1.VD = VF - VE

2.VE = VF + VD

3.VE = VF - VD

4.VD = VF + VE


Question:
Working Capital Turnover measures the relationship of Working Capital with:

1.Fixed Assets

2.Sales

3.Purchases

4.Stock


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  15. MBA Advertising and Sales Promotion Mcq Set 5
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  26. MBA Behavioural and Allied Sciences MCQ Set 3
  27. MBA Behavioural and Allied Sciences MCQ Set 4
  28. MBA Behavioural and Allied Sciences MCQ Set 5
  29. MBA Behavioural and Allied Sciences MCQ Set 6
  30. MBA Behavioural and Allied Sciences MCQ Set 7
  31. MBA Behavioural and Allied Sciences MCQ Set 8
  32. MBA Behavioural and Allied Sciences MCQ Set 9
  33. MBA Behavioural and Allied Sciences MCQ Set 10
  34. MBA Brand Management MCQ Set 1
  35. MBA Brand Management MCQ Set 2
  36. MBA Brand Management MCQ Set 3
  37. MBA Brand Management MCQ Set 4
  38. MBA Brand Management MCQ Set 5
  39. MBA Business Communication MCQ Set 1
  40. MBA Business Communication MCQ Set 2
  41. MBA Business Communication MCQ Set 3
  42. MBA Business Communication MCQ Set 4
  43. MBA Business Communication MCQ Set 5
  44. MBA Business Communication MCQ Set 6
  45. MBA Business Communication MCQ Set 7
  46. MBA Business Communication MCQ Set 8
  47. MBA Business Communication MCQ Set 9
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  50. MBA Business Economics MCQ Set 1
  51. MBA Business Economics MCQ Set 2
  52. MBA Business Economics MCQ Set 3
  53. MBA Business Economics MCQ Set 4
  54. MBA Business Economics MCQ Set 5
  55. MBA Business Economics MCQ Set 6
  56. MBA Business Environment MCQ Set 1
  57. MBA Business Environment MCQ Set 2
  58. MBA Business Environment MCQ Set 3
  59. MBA Business Environment MCQ Set 4
  60. MBA Business Environment MCQ Set 5
  61. MBA Business Environment MCQ Set 6
  62. MBA Business Environment MCQ Set 7
  63. MBA Business Environment MCQ Set 8
  64. MBA Business Environment MCQ Set 9
  65. MBA Business Ethics and Governance MCQ Set 1
  66. MBA Business Law Mcq Set 1
  67. MBA Business Law Mcq Set 2
  68. MBA Business Law Mcq Set 3
  69. MBA Business Law Mcq Set 4
  70. MBA Business Law Mcq Set 5
  71. MBA Business Law Mcq Set 6
  72. MBA Business Law Mcq Set 7
  73. MBA Business Law Mcq Set 8
  74. MBA Business Law Mcq Set 9
  75. MBA Business Mathematics Mcq Set 1
  76. MBA Business Mathematics Mcq Set 2
  77. MBA Business Mathematics Mcq Set 3
  78. MBA Business Mathematics Mcq Set 4
  79. MBA Business Mathematics Mcq Set 5
  80. MBA Business Mathematics Mcq Set 6
  81. MBA Business Statistics Mcq Set 1
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  83. MBA Computers In Management Mcq Set 1
  84. MBA Computers In Management Mcq Set 2
  85. MBA Computers In Management Mcq Set 3
  86. MBA Computers In Management Mcq Set 4
  87. MAB Cost and Managerial Accounting Mcq Set 1
  88. MBA Cost and Managerial Accounting Mcq Set 1
  89. MBA Cost and Managerial Accounting Mcq Set 2
  90. MBA Cost and Managerial Accounting Mcq Set 3
  91. MBA Cost and Managerial Accounting Mcq Set 4
  92. MBA Cost and Managerial Accounting Mcq Set 5
  93. MBA Cost and Managerial Accounting Mcq Set 6
  94. MBA Cost and Managerial Accounting Mcq Set 7
  95. MBA Cost and Managerial Accounting Mcq Set 8
  96. MBA Cost and Managerial Accounting Mcq Set 9
  97. MBA Cost and Managerial Accounting Mcq Set 10
  98. MBA Cost and Managerial Accounting Mcq Set 11
  99. MBA E-Business MCQ Set 1
  100. MBA E-Business MCQ Set 2
  101. MBA E-Business MCQ Set 3
  102. MBA E-Business MCQ Set 4
  103. MBA English Language MCQ Set 1
  104. MBA English Language MCQ Set 2
  105. MBA Entrepreneurship Management MCQ Set 1
  106. MBA Entrepreneurship Management MCQ Set 2
  107. MBA Entrepreneurship Management MCQ Set 3
  108. MBA Entrepreneurship Management MCQ Set 4
  109. MBA Entrepreneurship Management MCQ Set 5
  110. MBA Entrepreneurship Management MCQ Set 6
  111. MBA Financial Management MCQ Set 1
  112. MBA Financial Management MCQ Set 2
  113. MBA Financial Management MCQ Set 3
  114. MBA Financial Management MCQ Set 4
  115. MBA Financial Management MCQ Set 5
  116. MBA Financial Management MCQ Set 6
  117. MBA Financial Management MCQ Set 7
  118. MBA Financial Management MCQ Set 8
  119. MBA Financial Management MCQ Set 9
  120. MBA Financial Management MCQ Set 10
  121. MBA Financial Management MCQ Set 11
  122. MBA Financial Management MCQ Set 12
  123. MBA Human Resource Management Mcq Set 1
  124. MBA Human Resource Management Mcq Set 2
  125. MBA Human Resource Management Mcq Set 3
  126. MBA Human Resource Management Mcq Set 4
  127. MBA Human Resource Management Mcq Set 5
  128. MBA Human Resource Management Mcq Set 6
  129. MBA Human Resource Management Mcq Set 7
  130. MBA Human Resource Management Mcq Set 8
  131. MBA Insurance and Risk Management Mcq Set 1
  132. MBA Insurance and Risk Management Mcq Set 2
  133. MBA Insurance and Risk Management Mcq Set 3
  134. MBA Insurance and Risk Management Mcq Set 4
  135. MBA Insurance and Risk Management Mcq Set 5
  136. MBA Insurance and Risk Management Mcq Set 6
  137. MBA Management Information Systems Mcq Set 1
  138. MBA Management Information Systems Mcq Set 2
  139. MBA Management Information Systems Mcq Set 3
  140. MBA Management Information Systems Mcq Set 4
  141. MBA Management Information Systems Mcq Set 5
  142. MBA Management Information Systems Mcq Set 6
  143. MBA Management Information Systems Mcq Set 7
  144. MBA Management Information Systems Mcq Set 8
  145. MBA Management Information Systems Mcq Set 9
  146. MBA Marketing Management Mcq Set 1
  147. MBA Marketing Management Mcq Set 2
  148. MBA Marketing Management Mcq Set 3
  149. MBA Marketing Management Mcq Set 4
  150. MBA Marketing Management Mcq Set 5
  151. MBA Marketing Management Mcq Set 6
  152. MBA Marketing Management Mcq Set 7
  153. MBA Marketing Management Mcq Set 8
  154. MBA Marketing Management Mcq Set 9
  155. MBA Marketing Management Mcq Set 10
  156. MBA Marketing Management Mcq Set 11
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  158. MBA Marketing Management Mcq Set 13
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  160. MBA Media Planning Mcq Set 2
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  162. MBA Media Planning Mcq Set 4
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  164. MBA Operations Research Mcq Set 2
  165. MBA Operations Research Mcq Set 3
  166. MBA Operations Research Mcq Set 4
  167. MBA Operations Research Mcq Set 5
  168. MBA Organisational Behavior Mcq Set 1
  169. MBA Organisational Behavior Mcq Set 2
  170. MBA Organisational Behavior Mcq Set 3
  171. MBA Organisational Behavior Mcq Set 4
  172. MBA Principles and Practices of Management Mcq Set 1
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  174. MBA Principles and Practices of Management Mcq Set 3
  175. MBA Principles and Practices of Management Mcq Set 4
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  179. MBA Principles and Practices of Management Mcq Set 8
  180. MBA Principles and Practices of Management Mcq Set 9
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  182. MBA Production and Operations Management Mcq Set 2
  183. MBA Production and Operations Management Mcq Set 3
  184. MBA Production and Operations Management Mcq Set 4
  185. MBA Production and Operations Management Mcq Set 5
  186. MBA Production and Operations Management Mcq Set 6
  187. MBA Production and Operations Management Mcq Set 7
  188. MBA Production and Operations Management Mcq Set 8
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  193. MBA System Analysis and Design Mcq Set 3
  194. MBA System Analysis and Design Mcq Set 4
  195. MBA System Analysis and Design Mcq Set 5
  196. MBA System Analysis and Design Mcq Set 6
  197. MBA System Analysis and Design Mcq Set 7
  198. MBA System Analysis and Design Mcq Set 8
  199. MBA System Analysis and Design Mcq Set 9
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  201. MBA Total Quality Management Mcq Set 2
  202. MBA Total Quality Management Mcq Set 3
  203. MBA Total Quality Management Mcq Set 4
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