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.
| 651. |
Second mortgages pledged against bond's security are referred as |
| A. | oan mortgages |
| B. | edium mortgages |
| C. | enior mortgages |
| D. | unior mortgages |
| Answer» E. | |
| 652. |
An analysis and estimation of cash flows include |
| A. | nput data and key output |
| B. | epreciation schedule |
| C. | et salvage values |
| D. | ll of above |
| Answer» E. | |
| 653. |
Free cash flow is Rs 15000, operating cash flow is Rs 3000, investment outlay cash flow is Rs 5000 then salvage cash flow will be |
| A. | s 17,000.00 |
| B. | Rs 17,000.00 |
| C. | s 7,000.00 |
| D. | Rs 7,000.00 |
| Answer» D. Rs 7,000.00 | |
| 654. |
Double declining balance method and sum of years digits are included in |
| A. | early method |
| B. | ingle methods |
| C. | ouble methods |
| D. | ccelerated methods |
| Answer» E. | |
| 655. |
Real rate expected cash flows and nominal rate expected cash flows must be |
| A. | ccelerated |
| B. | qual |
| C. | ifferent |
| D. | nflated |
| Answer» C. ifferent | |
| 656. |
Project which is started by firm for increasing sales is classified as |
| A. | ew expansion project |
| B. | ld expanded project |
| C. | irm borrowing project |
| D. | roduct line selection |
| Answer» B. ld expanded project | |
| 657. |
Net investment in operating capital is subtracted from net operating profit after taxes to calculate |
| A. | elevant inflows |
| B. | ree cash flow |
| C. | elevant outflows |
| D. | ash outlay |
| Answer» C. elevant outflows | |
| 658. |
Net operating profit after taxes is Rs 4500, net investment in operating capital is Rs 8500 and then free cash flow would be |
| A. | Rs 4,000.00 |
| B. | s 4,000.00 |
| C. | Rs 18,000.00 |
| D. | s 18,000.00 |
| Answer» B. s 4,000.00 | |
| 659. |
An investment outlay cash flow is Rs 2000, an operating cash flow is Rs 1500 and salvage cash flow is Rs 3000 then free cash flow would be |
| A. | s 500.00 |
| B. | s 2,500.00 |
| C. | s 650.00 |
| D. | s 6,500.00 |
| Answer» E. | |
| 660. |
Free cash flow is Rs 17000 and net investment in operating capital is Rs 10000 then net operating profit after taxes would be |
| A. | s 7,000.00 |
| B. | s 27,000.00 |
| C. | Rs 27,000.00 |
| D. | Rs 7,000.00 |
| Answer» C. Rs 27,000.00 | |
| 661. |
Net investment in operating capital is Rs 7000 and net operating profit after taxes is Rs 11,000 then free cash flow will be |
| A. | Rs 18,000.00 |
| B. | s 18,000.00 |
| C. | Rs 4,000.00 |
| D. | s 4,000.00 |
| Answer» E. | |
| 662. |
Nominal interest rates and nominal cash flows are usually reflected the |
| A. | nflation effects |
| B. | pportunity effects |
| C. | quity effects |
| D. | ebt effects |
| Answer» B. pportunity effects | |
| 663. |
Cash flows that should be considered for decision in hand are classified as |
| A. | elevant cash flows |
| B. | rrelevant cash flows |
| C. | arginal cash flows |
| D. | ransaction cash flows |
| Answer» B. rrelevant cash flows | |
| 664. |
Free cash flow is Rs 12000, an operating cash flow is Rs 4000, an investment outlay cash flow is Rs 5000 then salvage cash flow would be |
| A. | Rs 21,000.00 |
| B. | s 21,000.00 |
| C. | Rs 3,000.00 |
| D. | s 3,000.00 |
| Answer» E. | |
| 665. |
Economists consider effects of started project on other parts of company or on environment of company is called |
| A. | xternalities |
| B. | oreign effects |
| C. | eighted effects |
| D. | pportunity effects |
| Answer» B. oreign effects | |
| 666. |
In capital budgeting, cost of capital is used as discount rate and is based on pre-determines |
| A. | ost of inflation |
| B. | ost of debt and equity |
| C. | ost of opportunity |
| D. | ost of transaction |
| Answer» C. ost of opportunity | |
| 667. |
Cash flows that could be generated from an owned asset by company but not use in project are classified as |
| A. | ccurred cost |
| B. | ean cost |
| C. | pportunity costs |
| D. | eighted cost |
| Answer» D. eighted cost | |
| 668. |
Weighted average cost of debt, preferred stock and common equity is classified as |
| A. | ost of salvage |
| B. | ost of interest |
| C. | ost of taxation |
| D. | ost of capital |
| Answer» E. | |
| 669. |
In cash flow estimation, depreciation shelters company's income from |
| A. | xpansion |
| B. | alvages |
| C. | axation |
| D. | iscounts |
| Answer» D. iscounts | |
| 670. |
In cash flow estimation and risk analysis, real rate will be equal to nominal rate if there is |
| A. | o inflation |
| B. | igh inflation |
| C. | o transactions |
| D. | o acceleration |
| Answer» B. igh inflation | |
| 671. |
A type of project whose cash flows would not depend on each other is classified as |
| A. | roject net gain |
| B. | ndependent projects |
| C. | ependent projects |
| D. | et value projects |
| Answer» C. ependent projects | |
| 672. |
Project whose cash flows are less than capital invested for required rate of return then net present value will be |
| A. | egative |
| B. | ero |
| C. | ositive |
| D. | ndependent |
| Answer» B. ero | |
| 673. |
Present value of future cash flows is Rs 4150 and an initial cost is Rs 1300 then profitability index will be |
| A. | .00% |
| B. | 0.19 |
| C. | .31 times |
| D. | s 5,450.00 |
| Answer» C. .31 times | |
| 674. |
A market interest rate for specific type of bond is classified as bonds |
| A. | equired rate of return |
| B. | equired option |
| C. | equired rate of redemption |
| D. | equired rate of earning |
| Answer» B. equired option | |
| 675. |
Unsecured bonds which is designated for only notes payable or all other debts are classified as |
| A. | esignated bonds |
| B. | ayable bonds |
| C. | rdinate bonds |
| D. | ubordinated bonds |
| Answer» E. | |
| 676. |
An unsecured bond that provides no lien against property as security for bond obligation is classified as |
| A. | ecured bond |
| B. | ebenture |
| C. | bligation bond |
| D. | pecific bond |
| Answer» C. bligation bond | |
| 677. |
An outstanding bonds are also classified as |
| A. | tanding bonds |
| B. | utdated bonds |
| C. | ated bonds |
| D. | easoned bonds |
| Answer» E. | |
| 678. |
Rate denoted as r* is best classified as |
| A. | eal risk-free interest rate |
| B. | eal-risk free nominal rate |
| C. | eal-risk free quoted rate |
| D. | eal-risk free nominal premium |
| Answer» B. eal-risk free nominal rate | |
| 679. |
Coupon rate of convertible bond is |
| A. | igher |
| B. | ower |
| C. | ariable |
| D. | table |
| Answer» C. ariable | |
| 680. |
Call provision practiced by company which states that call price will be paid is classified as |
| A. | uper refund provision |
| B. | uper put redemption |
| C. | ake-whole call provision |
| D. | uper call provision |
| Answer» D. uper call provision | |
| 681. |
If coupon rate is more than current rate of interest then bond will be sold |
| A. | ore than its par value |
| B. | easoned par value |
| C. | t par value |
| D. | elow its par value |
| Answer» B. easoned par value | |
| 682. |
An annual interest payment divided by current price of bond is considered as |
| A. | urrent yield |
| B. | aturity yield |
| C. | eturn yield |
| D. | arning yield |
| Answer» B. aturity yield | |
| 683. |
If bond's call provision is practiced in first year of issuance then an additional payment is classified as |
| A. | ssuance provision |
| B. | ond provision |
| C. | all provision |
| D. | irst provision |
| Answer» D. irst provision | |
| 684. |
Treasury bonds are exposed to additional risks that are included |
| A. | einvestment risk |
| B. | nterest rate risk |
| C. | nvestment risk |
| D. | oth A and B |
| Answer» E. | |
| 685. |
Bonds issued by corporations and exposed to default risk are classified as |
| A. | orporation bonds |
| B. | efault bonds |
| C. | isk bonds |
| D. | ero risk bonds |
| Answer» B. efault bonds | |
| 686. |
Redemption option which protects investors against rise in interest rate is considered as |
| A. | edeemable at deferred |
| B. | edeemable at par |
| C. | edeemable at refund |
| D. | edeemable at finding |
| Answer» C. edeemable at refund | |
| 687. |
Risk of fall in income due to fall in interest rates in future is classified as |
| A. | ncome risk |
| B. | nvestment risk |
| C. | einvestment risk |
| D. | ature risk |
| Answer» D. ature risk | |
| 688. |
Bond which is offered below its face value is classified as |
| A. | resent value bond |
| B. | riginal issue discount bond |
| C. | oupon issued bond |
| D. | iscounted bond |
| Answer» C. oupon issued bond | |
| 689. |
In capital budgeting, a negative net present value results in |
| A. | ero economic value added |
| B. | ercent economic value added |
| C. | egative economic value added |
| D. | ositive economic value added |
| Answer» D. ositive economic value added | |
| 690. |
In alternative investments, constant cash flow stream is equal to initial cash flow stream in approach which is classified as |
| A. | reater annual annuity method |
| B. | quivalent annual annuity |
| C. | esser annual annuity method |
| D. | ero annual annuity method |
| Answer» C. esser annual annuity method | |
| 691. |
Payback period in which an expected cash flows are discounted with help of project cost of capital is classified as |
| A. | iscounted payback period |
| B. | iscounted rate of return |
| C. | iscounted cash flows |
| D. | iscounted project cost |
| Answer» B. iscounted rate of return | |
| 692. |
An initial cost is Rs 6000 and probability index is 5.6 then present value of cash flows will be |
| A. | s 25,000.00 |
| B. | s 28,000.00 |
| C. | s 33,600.00 |
| D. | s 30,000.00 |
| Answer» D. s 30,000.00 | |
| 693. |
An increase in marginal cost of capital and capital rationing are two arising complications of |
| A. | aximum capital budget |
| B. | reater capital budget |
| C. | ptimal capital budget |
| D. | inimum capital budget |
| Answer» D. inimum capital budget | |
| 694. |
In capital budgeting, a technique which is based upon discounted cash flow is classified as |
| A. | et present value method |
| B. | et future value method |
| C. | et capital budgeting method |
| D. | et equity budgeting method |
| Answer» B. et future value method | |
| 695. |
Set of projects or set of investments usually maximize firm value is classified as |
| A. | ptimal capital budget |
| B. | inimum capital budget |
| C. | aximum capital budget |
| D. | reater capital budget |
| Answer» B. inimum capital budget | |
| 696. |
A modified internal rate of return is considered as present value of costs and is equal to |
| A. | V of hurdle rate |
| B. | V of hurdle rate |
| C. | V of terminal value |
| D. | V of terminal value |
| Answer» D. V of terminal value | |
| 697. |
Graph which is plotted for projected net present value and capital rates is called |
| A. | et loss profile |
| B. | et gain profile |
| C. | et future value profile |
| D. | et present value profile |
| Answer» E. | |
| 698. |
In capital budgeting, positive net present value results in |
| A. | egative economic value added |
| B. | ositive economic value added |
| C. | ero economic value added |
| D. | ercent economic value added |
| Answer» C. ero economic value added | |
| 699. |
An uncovered cost at start of year is Rs 200, full cash flow during recovery year is Rs 400 and prior years to full recovery is 3 then payback would be |
| A. | years |
| B. | .5 years |
| C. | years |
| D. | .5 years |
| Answer» C. years | |
| 700. |
Relationship between Economic Value Added (EVA) and Net Present Value (NPV) is considered as |
| A. | alued relationship |
| B. | conomic relationship |
| C. | irect relationship |
| D. | nverse relationship |
| Answer» D. nverse relationship | |