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

1. 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

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

a.Annuity

b.Reovery Factor

c.Compounding

d.Discounting

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

a.Profit Maximization

b.Welfare maximization

c.Any of these

d.Wealth Maximization

4. Funds are financial resources in the form of:

a.Business funds

b.All of these

c.Cash Equivalents

d.Corporate Capital

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

a.Flow Of Funds

b.Funding on Forex

c.Fresh on Funding

d.Focus on Funding

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

a.Plain Vanilla bonds

b.Commodity linked bonds

c.Pittables debentures

d.Zero coupon bonds

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

a.Automatic Teller Machine

b.Automated Teller Machine

c.Authorized Teller Machine

d.Auto Teller Machine

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

a.Auxiliary Revenue for Investing on Market

b.Auto-Regressive Integrated Moving Average

c.Active Resource for Investment and Management

d.Autonomous Resource for International Movement Association

9. Industrial Development Bank of India is

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

b.Wholly owned Government of India undertaking

c.Pubic Limited Company

d.Wholly-owned subsidiary of Reserve Bank of India

10. Financial leverage is also known as

a.Trading on equity

b.Trading on debt

c.Interest on equity

d.Interest on debt

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

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

b.To distribute it as dividend to the shareholders

c.Either a or b

d.None of these

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

a.Beginning price of security

b.Total beginning price and ending price of security

c.Difference between beginning price and ending price of security

d.Ending price of security

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

a.Net uield Security Exchnage

b.Net Asset Value

c.National Stock Exchange

d.New York Stock Exchnage

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

a.Asymmetric Transfer Mode

b.Annual Trade Marketing

c.Asynchronous Transfer Mode

d.Account Transaction Mode

15. 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

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

a.Functional Profit Investment

b.Financial Portfolio Investment

c.Foreign Portfolio Investment

d.Financial Performance Index

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

a.Total return

b.Premium

c.Dividend

d.Total risk

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

a.Income shares

b.Blue chip shares

c.Growth shares

d.Cyclical shares

19. Not measurable time is?

a.Certainty

b.Uncertainty

c.All of these

d.Risk

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

a.Capital expenditure

b.Rental Expenditure

c.None of these

d.Revenue expenditure

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

a.Free cash flow models

b.None of these

c.H model ofequity valuation

d.Gordon Model

22. The financial institute IFCI established in

a.1960

b.1954

c.1948

d.1945

23. 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 equal to the nominal return

c.None of these

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

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

a.Non diversifiable risk

b.Adjusted risk

c.Diversifiable risk

d.None of these

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

a.Native Sensex Efficiency

b.National Shares and Equities

c.National Export in Shares

d.National Stock Exchange

26. 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

27. The main components of capital budgeting are:

a.Capital expenditure and Budgeting

b.Capital expenditure

c.Budgeting

d.none of these

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

a.Planning and Leaving

b.Premium and Liability

c.Profit and Loss

d.Promoting and Liquidity

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

a.Year to Delivery

b.Year-to-date

c.Yield to Debit

d.Yield of Divergence

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

a.Negative

b.Less than 0

c.Greater than 0

d.Equal to 0

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

a.Management Funtion

b.Finance Function

c.Control Function

d.None of these

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

a.Non-recurring finance functions

b.None of these

c.Recurring Finance

d.Both a and b

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

a.Certified Operating Officer

b.Credit on Option

c.Chief Operating Officer

d.Credit Operating Officer

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

a.Operating lease

b.Direct leasing arrangement

c.Leveraged lease

d.Sales and leaseback

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

a.Investment Decision

b.Finance decisions

c.Any of these

d.Dividend decisions

36. Financial leverage measures ____________

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

b.1% Variation in level of production

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

d.No change with EBIT and EPS

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

a.Central Trading Operation

b.Capital take Over

c.Chief Technology Officer

d.Commerce Trade Officer

38. The balance sheet valuation is a:

a.None of these

b.Historical approach

c.Nominal approach

d.Futuristic approach

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

a.Risk approach

b.Earnings approach

c.Backward approach

d.Forward approach

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

a.Discounting

b.Annuity

c.Compounding

d.None of these

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

a.Mney market

b.Secondary market

c.None of these

d.Primary market

42. 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 premium

b.Inflation premium

c.Required rate of return

d.Risk free rate of return

43. 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.Liquidity Risk

c.Financial Risk

d.Default Risk

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

a.Controller and Auditor General of India

b.Commercial Auditor General

c.Consolidated Audit General

d.Commercial Account Growth

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

a.Discounted Prices

b.Market Price

c.Augmented price

d.Shadow prices

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

a.Growth shares

b.Cyclical shares

c.Income shares

d.Defensive shares

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

a.Food and Finance Corporation Board

b.Foreign Currency Convertible Bond

c.Fast Credits on Conservative Basis

d.Financial Committee for Certified Business

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

a.Private Equity

b.Price-to-earning ration

c.Premium Exchange

d.Profitable enquiry

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

a.Current Security Officer

b.Consolidated Statistics Order

c.Cabinet Security Officer

d.Chief Security Officer

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

a.None of these

b.Non-recurring finance functions

c.Both a and b

d.Recurring Finance

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

a.Unsystematic risk

b.None of these

c.Non diversifiable risk

d.systematic risk

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

a.Middle Market

b.Mutual Market Trading

c.Money Market

d.Management Key Trading

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

a.Humped slope

b.Downward slope

c.Flat

d.Upwards slope

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

a.Wage Collateral

b.Withdraw Cash

c.Wage Capital

d.Working capital

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

a.Financial Risk

b.Liquidity Risk

c.Business Risk

d.Interest Risk

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

a.Wealth maximization objective

b.Welfare maximization objective

c.Profit maximization objective

d.None of these

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

a.Negative

b.Highly positive

c.Highly negative

d.Non correlation

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

a.Cash flows

b.Earnings

c.Expected dividends

d.All of these

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

a.Upwards

b.Downwards

c.Humped

d.Any Pattern

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

a.None of these

b.Discounted factor

c.Capital recovery factor

d.Compounding factor

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

a.None of these

b.19th Centruy

c.20th Century

d.21st Century

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.15%

b.10%

c.5%

d.2.50%

63. Financial controller is responsible

a.Credit Management

b.Cash Management

c.None of these

d.Securities Management

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

a.India Development Bonds

b.Investment in Direct Bonds

c.International Deposit on Bonds

d.Insurance Development Board

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

a.Current return

b.Total return

c.Capital return

d.None of these

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

a.Quarter-to-Delivery

b.Quality Trade Division

c.Quarter-to-Date

d.Quantitative Taxation Dividend

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

a.Cost of Capital

b.Control

c.Risk

d.All of these

68. The yield curve shows the relationship between:

a.Terms to maturaluty and price

b.Yield to maturity and terms to maturity

c.Yield to maturity and price

d.None of these

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

a.Cross sectional analysis

b.Time series analysis

c.Technical analysis

d.None of these

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

a.Maturity for

b.Market with finance

c.Financial Month

d.Mutual Fund

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

a.Annual Gross Marketing

b.Annual General Marketing

c.Annual General Meeting

d.Annual Gain Margin

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

a.Collective exhausting

b.Either collective exhausting or mutually inclusive

c.Mutually inclusive

d.None of these

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

a.Compounding

b.Both a and b

c.None of these

d.Discounting

74. Financial Management is mainly concerned with ____________

a.Efficient Management of every business

b.Profit maximization

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

d.Arrangement of funds

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

a.Native Hidden Brokerage

b.Non Hiring Business

c.National Housing Bank

d.National Housing and Building Association

76. 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.Wealth

c.All of these

d.Payoff

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

a.Capital Structure

b.None of these

c.Financial Structure

d.Both of these

78. Financial decisions involve ____________

a.investment dividend decisions

b.Financing cash decisions

c.investment sales decisions

d.Investment, Financing and dividend decisions

79. 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.25%

c.15%

d.10%

80. 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.Private Finance

b.Business Finance

c.All of these

d.Public Finance

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

a.Relative valuation modesl

b.None of these

c.Both a and b

d.Dividend valuation models

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

a.Working capital decisions

b.Both a and b

c.Short term investment decisions

d.None of these

83. Financial leverage helps one to estimate ____________

a.The financial risk

b.Prouction risk

c.The business risk

d.Business and Financial risk

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

a.Central Committee Exchange Act

b.Cabinet Committee on Economic Affairs

c.Certified Commerce Exchange Act

d.Central Commerce Economic Affairs

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

a.All of these

b.Credit management

c.Procurement of essential funds

d.Cash management

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

a.Positive

b.Perfectly negative

c.Zero

d.Negative

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

a.Earning Preferred Stock

b.Earnings per share

c.Exchange per Share

d.Equity Private Selling

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

a.Call Risk

b.Liquidity Risk

c.Interest Risk

d.Financial risk

89. Yield to maturity is what?

a.None of the above

b.Current yield

c.Annual appreciation or depreciation

d.Combination of current yield and annual apppreciation

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

a.Effective management of capital

b.Acquiring capital assets of the organization

c.Arrange of utiization of funds

d.Arrangement of financial resources

91. 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.Working Capital decisions

b.Capital bbudgeting decisions

c.Financial Decisions

d.None of these

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

a.Risk

b.None of these

c.Timing and Risk

d.Timing

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

a.Available For Stock

b.Annual Financial Stock

c.Annual Foreign Stock

d.Available For Sale

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

a.Long Term

b.Short Term

c.Medium Term

d.Medium Term and Long Term

95. Business finance deals with which of the following?

a.Both a and b

b.None of these

c.Procuring funds from different sources on fair terms

d.Utilize funds efficiently

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

a.Balance Stock Equity

b.Base Stock Exchange

c.Bombay Stock Exchange

d.Balance Sheet Equity

97. Current yield is equal to What?

a.Any of these

b.Income yield

c.Market yield

d.Running Yield

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

a.Leverage Level Committee

b.Lender of Last Commodity

c.Limited Libility corporation

d.Limited Liablity Company

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

a.Budgeting

b.Both a and b

c.Compounding method

d.Discounting method

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

a.Real Asset

b.Financial Asset

c.Fictitious asset

d.Tangible Asset

Finance MCQ Quiz for Various Competitive Exams

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

Submit a Comment Cancel reply

Latest Posts

CBSE School Lessons

Entrance Exams

Top Entrance Exams

Admission Information

Career and Jobs

Education India

Popular Pages