Finance MCQ Quiz for Competitive Exams

Finance MCQs Question Answers Quiz | 100 Finance MCQs for Entrance exams

Finance MCQ Quiz– Practice Finance MCQ Question suitable for various Competitive Exams. Finance MCQ Questions are important for various competitive exams. Here we have compiled 100 Finance MCQ Questions with solutions. Practice Finance MCQ Quiz

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1. The price of a security at the beginning of the year is 200, the price at the end of the year is 225 and the dividend paid at the end of the year is 15. The total rate of return is:

a.20%

b.10%

c.25%

d.15%

2. The relationship of required rate of return and risk shows the linearity in the:

a.Asset market line

b.Security market line

c.Capital market line

d.None of these

3. What is the full form of "NYSE"?

a.Net uield Security Exchnage

b.Net Asset Value

c.New York Stock Exchnage

d.National Stock Exchange

4. What is the full form of "IDB"?

a.International Deposit on Bonds

b.Insurance Development Board

c.Investment in Direct Bonds

d.India Development Bonds

5. What is the full form of "BSE"?

a.Balance Stock Equity

b.Bombay Stock Exchange

c.Balance Sheet Equity

d.Base Stock Exchange

6. The process of calculating future value of cash flows is known as

a.Discounting

b.Both a and b

c.Compounding

d.None of these

7. What is the full form of "P/E"?

a.Price-to-earning ration

b.Profitable enquiry

c.Premium Exchange

d.Private Equity

8. What is the full form of "AFS"?

a.Available For Stock

b.Annual Financial Stock

c.Available For Sale

d.Annual Foreign Stock

9. The method of converting the amount of future cash into an amount of cash and cash equivalents value in present is known as:

a.None of these

b.Annuity

c.Compounding

d.Discounting

10. The risk that arises due to use of debt by the firm causing variability of return for creditors and shareholders is:

a.Call Risk

b.Default Risk

c.Financial Risk

d.Liquidity Risk

11. What is the full form of "NSE"?

a.Native Sensex Efficiency

b.National Export in Shares

c.National Stock Exchange

d.National Shares and Equities

12. What indicate the relationship between interest rate and reinvestment rate

a.Perfectly negative

b.Zero

c.Positive

d.Negative

13. The sum of short term and long term sources of finance is known as:

a.Both of these

b.None of these

c.Financial Structure

d.Capital Structure

14. Not measurable time is?

a.Uncertainty

b.All of these

c.Certainty

d.Risk

15. What is the full form of "ATM"?

a.Auto Teller Machine

b.Automated Teller Machine

c.Automatic Teller Machine

d.Authorized Teller Machine

16. The yield curve shows the relationship between:

a.Terms to maturaluty and price

b.Yield to maturity and price

c.Yield to maturity and terms to maturity

d.None of these

17. Straight bonds are also known as which of the following?

a.Pittables debentures

b.Plain Vanilla bonds

c.Zero coupon bonds

d.Commodity linked bonds

18. In his traditional role the finance manager is responsible for ___________

a.Arrange of utiization of funds

b.Acquiring capital assets of the organization

c.Effective management of capital

d.Arrangement of financial resources

19. The reciprocal of the present value of annuity is known as what?

a.Discounted factor

b.Compounding factor

c.Capital recovery factor

d.None of these

20. Funds are financial resources in the form of:

a.Cash Equivalents

b.All of these

c.Business funds

d.Corporate Capital

21. The variability in return on security due to changes in the level of interest rate in market is called as:

a.Interest Risk

b.Liquidity Risk

c.Call Risk

d.Financial risk

22. What is the full form of "CCEA"?

a.Certified Commerce Exchange Act

b.Cabinet Committee on Economic Affairs

c.Central Committee Exchange Act

d.Central Commerce Economic Affairs

23. The yield curve representing the structure of interest rates of bonds may follow the?

a.Any Pattern

b.Humped

c.Downwards

d.Upwards

24. Financial leverage is also known as

a.Trading on equity

b.Trading on debt

c.Interest on debt

d.Interest on equity

25. The greater long term rates as compared to short term rates is an indicator of which of the following ….

a.Upwards slope

b.Humped slope

c.Downward slope

d.Flat

26. The degree correlation between risk and return over a longer period of time is generally …?

a.Non correlation

b.Negative

c.Highly positive

d.Highly negative

27. The valuation of equity by the discounted cash flow techniques depends on:

a.Expected dividends

b.Cash flows

c.Earnings

d.All of these

28. The principal objective was to create a development financial institution for providing ______project financing to Indian businesses:

a.Medium Term and Long Term

b.Short Term

c.Long Term

d.Medium Term

29. What is the full form of "P&L"?

a.Premium and Liability

b.Promoting and Liquidity

c.Planning and Leaving

d.Profit and Loss

30. Industrial Development Bank of India is

a.A corporation and owned by the Government of India and Public secot banks

b.Pubic Limited Company

c.Wholly-owned subsidiary of Reserve Bank of India

d.Wholly owned Government of India undertaking

31. The financial manager selects one or more sources of finance after proper taking into Consideration of:

a.Risk

b.All of these

c.Cost of Capital

d.Control

32. What is the full form of "LLC"?

a.Lender of Last Commodity

b.Limited Liablity Company

c.Limited Libility corporation

d.Leverage Level Committee

33. The balance sheet valuation is a:

a.Futuristic approach

b.Nominal approach

c.Historical approach

d.None of these

34. Financial management came into existence as a separate field of study from…?

a.21st Century

b.19th Centruy

c.None of these

d.20th Century

35. The shares of the companies having high dividend payout ratios are:

a.Cyclical shares

b.Income shares

c.Growth shares

d.Defensive shares

36. What is the full form of "COO"?

a.Certified Operating Officer

b.Chief Operating Officer

c.Credit Operating Officer

d.Credit on Option

37. The social cost benefits analysis is primarily used to determine the economic benefits of the activities in forms of which of the following:

a.Shadow prices

b.Augmented price

c.Market Price

d.Discounted Prices

38. Purchasing power of risk hit the investor when there are chances that the:

a.Real return on a security is more than the nominal return

b.Real return on a security is less than the nominal return

c.None of these

d.Real return on a security is equal to the nominal return

39. The excess of the present value of benefits over the present value of costs of a course of Action is called as:

a.Benefits

b.All of these

c.Wealth

d.Payoff

40. An asset that derives value from a contractual Claim is called as

a.Tangible Asset

b.Real Asset

c.Fictitious asset

d.Financial Asset

41. The type of lease that includes a third party, a lender, is called a(n)

a.Sales and leaseback

b.Operating lease

c.Direct leasing arrangement

d.Leveraged lease

42. What is the full form of "NHB"?

a.Non Hiring Business

b.Native Hidden Brokerage

c.National Housing Bank

d.National Housing and Building Association

43. The profit maximization objective has been criticized on the basis of:

a.All of these

b.Ignore time value of money

c.Ignore risk factor

d.Ambiguity

44. The value of holding period return is always show:

a.Greater than 0

b.Less than 0

c.Equal to 0

d.Negative

45. Which is the main motive is to select activities having positive impact on society in:

a.Wealth maximization objective

b.Profit maximization objective

c.Welfare maximization objective

d.None of these

46. The minimum expected rate of return that is needed to persuade an investor to purchase the security at given risk is which of the following ?

a.Risk free rate of return

b.Risk premium

c.Inflation premium

d.Required rate of return

47. The risk in terms of variability in security’s total return due to some exogenous factors is known as:

a.systematic risk

b.Unsystematic risk

c.Non diversifiable risk

d.None of these

48. Financial leverage measures ____________

a.No change with EBIT and EPS

b.Sensitivity of EPS with respect to 1% change in level of EBIT

c.Sensitivity of EBIT with Respect of 1% change with respoect to output

d.1% Variation in level of production

49. Which of the following risks is indicated by the beta coefficient in Financial Management?

a.Diversifiable risk

b.None of these

c.Non diversifiable risk

d.Adjusted risk

50. The financial activities which are performed only on special events like promotion. Amalgamation and solvency crisis are called as:

a.Non-recurring finance functions

b.None of these

c.Both a and b

d.Recurring Finance

51. The cash flows at different time periods should be made comparable to take sound Decisions by adjusting which of the following?

a.None of these

b.Timing and Risk

c.Risk

d.Timing

52. Business finance deals with which of the following?

a.None of these

b.Procuring funds from different sources on fair terms

c.Both a and b

d.Utilize funds efficiently

53. What is the full form of "CTO"?

a.Chief Technology Officer

b.Capital take Over

c.Central Trading Operation

d.Commerce Trade Officer

54. What is the full form of "MMKT"?

a.Management Key Trading

b.Money Market

c.Mutual Market Trading

d.Middle Market

55. What is the full form of "YTD"?

a.Yield to Debit

b.Year to Delivery

c.Year-to-date

d.Yield of Divergence

56. The comparison of various facets of the same firm over a period of time is called as

a.Time series analysis

b.Cross sectional analysis

c.Technical analysis

d.None of these

57. The managerial process which is concerned with the planning and control of financial resources is called as:

a.None of these

b.Control Function

c.Management Funtion

d.Finance Function

58. What is the full form of "FCCB"?

a.Foreign Currency Convertible Bond

b.Fast Credits on Conservative Basis

c.Food and Finance Corporation Board

d.Financial Committee for Certified Business

59. Risk associated with a particular firm’s operating conditions is which of the following risk?

a.Financial Risk

b.Interest Risk

c.Business Risk

d.Liquidity Risk

60. What is the full form of "CAG"?

a.Consolidated Audit General

b.Commercial Account Growth

c.Commercial Auditor General

d.Controller and Auditor General of India

61. The decisions relating to the use of profits or income of an entity or organization are known

a.Dividend decisions

b.Investment Decision

c.Finance decisions

d.Any of these

62. The price of a security at the beginning of year is 100, the price at the end of the year is 125 and dividend paid at the end of the year is Rs.5. The current return of the security is:

a.10%

b.2.50%

c.5%

d.15%

63. What is the full form of "EPS"?

a.Earning Preferred Stock

b.Exchange per Share

c.Earnings per share

d.Equity Private Selling

64. The discounted cash flow is which of the following approach?

a.Forward approach

b.Earnings approach

c.Backward approach

d.Risk approach

65. What is the full form of "CSO"?

a.Consolidated Statistics Order

b.Current Security Officer

c.Chief Security Officer

d.Cabinet Security Officer

66. The Market of initial public offerings where any new share is issued known as:

a.Secondary market

b.None of these

c.Mney market

d.Primary market

67. The financial institute IFCI established in

a.1960

b.1945

c.1954

d.1948

68. The application of the probability distribution is the characteristic of possible outcome that must be:

a.Collective exhausting

b.None of these

c.Either collective exhausting or mutually inclusive

d.Mutually inclusive

69. What is the full form of "WC"?

a.Wage Capital

b.Wage Collateral

c.Withdraw Cash

d.Working capital

70. Current yield is equal to What?

a.Running Yield

b.Income yield

c.Market yield

d.Any of these

71. Financial Management is mainly concerned with ____________

a.Efficient Management of every business

b.Arrangement of funds

c.All aspects of acquiring and utilizing financial resources for firms activities

d.Profit maximization

72. What is the full form of "ARIMA"?

a.Auto-Regressive Integrated Moving Average

b.Active Resource for Investment and Management

c.Auxiliary Revenue for Investing on Market

d.Autonomous Resource for International Movement Association

73. Yield to maturity is what?

a.Current yield

b.Annual appreciation or depreciation

c.Combination of current yield and annual apppreciation

d.None of the above

74. What is the full form of "AGM"?

a.Annual General Marketing

b.Annual General Meeting

c.Annual Gain Margin

d.Annual Gross Marketing

75. The government finance which includes the principles and practices relating to the Procurement and management of funds for Central Government, and Local bodies is known as:

a.All of these

b.Public Finance

c.Private Finance

d.Business Finance

76. Cumulative wealth index measures the level of wealth of investor by taking the cumulative effect of:

a.Premium

b.Dividend

c.Total return

d.Total risk

77. Current return is the ratio of annual income to:

a.Beginning price of security

b.Ending price of security

c.Difference between beginning price and ending price of security

d.Total beginning price and ending price of security

78. A fixed cash flow in each year for a specified number of years is called as…….

a.Annuity

b.Discounting

c.Reovery Factor

d.Compounding

79. The model that assumes the normal rate of growth over an indefinite time horizon is assumed is:

a.Gordon Model

b.H model ofequity valuation

c.None of these

d.Free cash flow models

80. What is the full form of "ATM"?

a.Annual Trade Marketing

b.Asymmetric Transfer Mode

c.Asynchronous Transfer Mode

d.Account Transaction Mode

81. The sources of finance from which the quantum of required funds can be raised is/are:

a.Share Capital

b.Trade Credit

c.Debt Capital

d.All of these

82. Short term or current assets Decisions are known as:

a.Working capital decisions

b.Both a and b

c.None of these

d.Short term investment decisions

83. The profits or income of an entity or organization can be used:

a.Either a or b

b.To distribute it as dividend to the shareholders

c.To retain it in business in the form of accumulated profits

d.None of these

84. The shares of well-established, financially strong and big companies having remarkable Record of dividends and earnings are known as:

a.Income shares

b.Cyclical shares

c.Blue chip shares

d.Growth shares

85. The financial objectives in terms of decision criteria may be:

a.Wealth Maximization

b.Welfare maximization

c.Profit Maximization

d.Any of these

86. The decisions of investing in long term or fixed assets on the basis of cost-benefit analysis or risk-return analysis are known as:

a.Capital bbudgeting decisions

b.Working Capital decisions

c.Financial Decisions

d.None of these

87. What is the full form of "QTD"?

a.Quality Trade Division

b.Quantitative Taxation Dividend

c.Quarter-to-Date

d.Quarter-to-Delivery

88. What is the full form of "MF"?

a.Market with finance

b.Mutual Fund

c.Financial Month

d.Maturity for

89. The appreciation in the value of security or asset is called as:

a.None of these

b.Total return

c.Current return

d.Capital return

90. The method that converts the amount of present cash into an amount of cash of equivalent value in future is:

a.Both a and b

b.Discounting method

c.Budgeting

d.Compounding method

91. The main components of capital budgeting are:

a.Capital expenditure and Budgeting

b.Capital expenditure

c.none of these

d.Budgeting

92. What is the full form of "FOF"?

a.Focus on Funding

b.Funding on Forex

c.Flow Of Funds

d.Fresh on Funding

93. The investment made in fixed assets is known as:

a.Capital expenditure

b.Rental Expenditure

c.Revenue expenditure

d.None of these

94. The financial activities which are performed regularly are known as:

a.Both a and b

b.Recurring Finance

c.None of these

d.Non-recurring finance functions

95. Financial decisions involve ____________

a.investment dividend decisions

b.Financing cash decisions

c.investment sales decisions

d.Investment, Financing and dividend decisions

96. Financial controller is responsible

a.Securities Management

b.Cash Management

c.Credit Management

d.None of these

97. What is the full form of "FPI"?

a.Financial Performance Index

b.Financial Portfolio Investment

c.Functional Profit Investment

d.Foreign Portfolio Investment

98. Which models generally applied by the fundamental analysts to valuate the equity share are called to be?

a.None of these

b.Dividend valuation models

c.Both a and b

d.Relative valuation modesl

99. Financial leverage helps one to estimate ____________

a.Business and Financial risk

b.The financial risk

c.Prouction risk

d.The business risk

100. Treasurer performs the functions of which of the following functions:

a.Procurement of essential funds

b.All of these

c.Credit management

d.Cash management

Finance MCQ Quiz for Various Competitive Exams

Finance MCQs Question Answers Quiz | 100 Finance MCQs for Entrance exams

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