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Corporate Finance MCQ With Answers

Question 1 of 3

Q1 . 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

Q2 . 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

Q3 . 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

Q4 . 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

Q5 . The firm's investment decision is also called as the

A Financing Decision

B Capital Budgeting Decision

C Liquidity Decision

D Dividend Decision

Q6 . From the following, which is not considered as the financial asset ?

A Common Stock

B Patents

C Bonds

D Preferred Stock

Q7 . 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

Q8 . The term Over or Under Subscription is used in case of ---

A Bank Financing

B Public Issue

C Non Performing Assets

D Syndicate Financing

Q9 . Quick Ratio indicates the ..

A Profitability of the company

B Cash position of the company

C Capital Structure of the company

D None of the above

Q10 . Normally the Cost of Capital should be -----

A Equal to IRR

B Less than IRR

C More than IRR

D Corresponding to IRR

Q11 . Limited Liability is main feature of ---

A Sole Proprietorship

B Partnership

C Corporations

D N G O

Q12 . From the following, which is not the direct middleman in the capital market ?

A Rating Agencies

B Broker

C Banker

D Trustee

Q13 . 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

Q14 . 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

Q15 . Financial leverage of the company is ascertaining by using..

A Liquidity Ratio

B Long Term Solvency Ratio

C Turnover Ratio

D Profitability Ratio

Q16 . 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

Q17 . The creditors of company are usually interested in observing the --

A Liquidity Ratio

B Solvency Ratio

C Profitability Ratio

D Turnover Ration

Q18 . 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

Q19 . 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

Q20 . 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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