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 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

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

a.Call Risk

b.Financial risk

c.Liquidity Risk

d.Interest Risk

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

a.Profit Maximization

b.Welfare maximization

c.Wealth Maximization

d.Any of these

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

a.Ambiguity

b.All of these

c.Ignore risk factor

d.Ignore time value of money

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

a.Control

b.Risk

c.All of these

d.Cost of Capital

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

a.Lender of Last Commodity

b.Limited Libility corporation

c.Leverage Level Committee

d.Limited Liablity Company

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

a.Timing

b.None of these

c.Risk

d.Timing and Risk

8. Current yield is equal to What?

a.Market yield

b.Any of these

c.Income yield

d.Running Yield

9. Financial leverage helps one to estimate ____________

a.Prouction risk

b.The financial risk

c.The business risk

d.Business and Financial risk

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

a.Quality Trade Division

b.Quantitative Taxation Dividend

c.Quarter-to-Delivery

d.Quarter-to-Date

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

a.Maturity for

b.Mutual Fund

c.Financial Month

d.Market with finance

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

a.Annual Gain Margin

b.Annual General Marketing

c.Annual Gross Marketing

d.Annual General Meeting

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

a.Asymmetric Transfer Mode

b.Account Transaction Mode

c.Annual Trade Marketing

d.Asynchronous Transfer Mode

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

a.Premium Exchange

b.Private Equity

c.Price-to-earning ration

d.Profitable enquiry

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

a.Balance Stock Equity

b.Base Stock Exchange

c.Balance Sheet Equity

d.Bombay Stock Exchange

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

a.Income shares

b.Defensive shares

c.Cyclical shares

d.Growth shares

17. 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.Flat

d.Downward slope

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

a.Less than 0

b.Negative

c.Greater than 0

d.Equal to 0

19. Financial decisions involve ____________

a.investment dividend decisions

b.Investment, Financing and dividend decisions

c.investment sales decisions

d.Financing cash decisions

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

a.Any Pattern

b.Upwards

c.Downwards

d.Humped

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

a.Premium

b.Total risk

c.Total return

d.Dividend

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

a.Short Term

b.Medium Term and Long Term

c.Medium Term

d.Long Term

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

a.Revenue expenditure

b.None of these

c.Rental Expenditure

d.Capital expenditure

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

a.Adjusted risk

b.Diversifiable risk

c.Non diversifiable risk

d.None of these

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

a.Plain Vanilla bonds

b.Pittables debentures

c.Commodity linked bonds

d.Zero coupon bonds

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

a.None of these

b.Collective exhausting

c.Either collective exhausting or mutually inclusive

d.Mutually inclusive

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

a.Insurance Development Board

b.Investment in Direct Bonds

c.International Deposit on Bonds

d.India Development Bonds

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

a.All of these

b.Procurement of essential funds

c.Credit management

d.Cash management

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

a.Market Price

b.Discounted Prices

c.Augmented price

d.Shadow prices

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

a.Cash flows

b.Expected dividends

c.Earnings

d.All of these

31. Financial Management is mainly concerned with ____________

a.Arrangement of funds

b.Efficient Management of every business

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

d.Profit maximization

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

a.Unsystematic risk

b.systematic risk

c.Non diversifiable risk

d.None of these

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

a.Business Risk

b.Financial Risk

c.Liquidity Risk

d.Interest Risk

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

a.None of these

b.Non-recurring finance functions

c.Both a and b

d.Recurring Finance

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

a.Funding on Forex

b.Fresh on Funding

c.Focus on Funding

d.Flow Of Funds

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

a.Growth shares

b.Cyclical shares

c.Income shares

d.Blue chip shares

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

a.Chief Technology Officer

b.Commerce Trade Officer

c.Central Trading Operation

d.Capital take Over

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

a.Free cash flow models

b.Gordon Model

c.H model ofequity valuation

d.None of these

39. 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

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

a.Auxiliary Revenue for Investing on Market

b.Autonomous Resource for International Movement Association

c.Auto-Regressive Integrated Moving Average

d.Active Resource for Investment and Management

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

a.Net Asset Value

b.New York Stock Exchnage

c.National Stock Exchange

d.Net uield Security Exchnage

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 free rate of return

b.Risk premium

c.Required rate of return

d.Inflation premium

43. 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.15%

c.5%

d.2.50%

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

a.Functional Profit Investment

b.Financial Portfolio Investment

c.Financial Performance Index

d.Foreign Portfolio Investment

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

a.Secondary market

b.Primary market

c.Mney market

d.None of these

46. 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.None of these

c.Working Capital decisions

d.Financial Decisions

47. The financial institute IFCI established in

a.1945

b.1948

c.1960

d.1954

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

a.Commercial Auditor General

b.Commercial Account Growth

c.Controller and Auditor General of India

d.Consolidated Audit General

49. The balance sheet valuation is a:

a.Historical approach

b.None of these

c.Futuristic approach

d.Nominal approach

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

a.Wage Collateral

b.Working capital

c.Withdraw Cash

d.Wage Capital

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

a.Cabinet Security Officer

b.Current Security Officer

c.Chief Security Officer

d.Consolidated Statistics Order

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

a.Relative valuation modesl

b.Both a and b

c.Dividend valuation models

d.None of these

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

a.Recurring Finance

b.Both a and b

c.None of these

d.Non-recurring finance functions

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

a.National Shares and Equities

b.Native Sensex Efficiency

c.National Export in Shares

d.National Stock Exchange

55. Financial leverage measures ____________

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

b.1% Variation in level of production

c.No change with EBIT and EPS

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

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

a.Equity Private Selling

b.Earning Preferred Stock

c.Exchange per Share

d.Earnings per share

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

a.Compounding factor

b.Discounted factor

c.Capital recovery factor

d.None of these

58. Financial controller is responsible

a.Credit Management

b.Cash Management

c.Securities Management

d.None of these

59. The main components of capital budgeting are:

a.Budgeting

b.none of these

c.Capital expenditure

d.Capital expenditure and Budgeting

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

a.Total beginning price and ending price of security

b.Beginning price of security

c.Difference between beginning price and ending price of security

d.Ending price of security

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

a.Both a and b

b.None of these

c.Working capital decisions

d.Short term investment decisions

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

a.Middle Market

b.Money Market

c.Mutual Market Trading

d.Management Key Trading

63. Not measurable time is?

a.Certainty

b.Uncertainty

c.Risk

d.All of these

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

a.Dividend decisions

b.Finance decisions

c.Investment Decision

d.Any of these

65. 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.25%

b.20%

c.10%

d.15%

66. 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.Compounding

c.Discounting

d.Annuity

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

a.19th Centruy

b.20th Century

c.21st Century

d.None of these

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

a.Both of these

b.Capital Structure

c.Financial Structure

d.None of these

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

a.Wealth

b.Benefits

c.All of these

d.Payoff

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

a.None of these

b.Wealth maximization objective

c.Welfare maximization objective

d.Profit maximization objective

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

a.Management Funtion

b.None of these

c.Control Function

d.Finance Function

72. 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.Business Finance

b.All of these

c.Private Finance

d.Public Finance

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

a.Arrange of utiization of funds

b.Arrangement of financial resources

c.Acquiring capital assets of the organization

d.Effective management of capital

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

a.Automatic Teller Machine

b.Authorized Teller Machine

c.Automated Teller Machine

d.Auto Teller Machine

75. 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 Government of India undertaking

d.Wholly-owned subsidiary of Reserve Bank of India

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

a.Discounting

b.Compounding

c.Annuity

d.Reovery Factor

77. Financial leverage is also known as

a.Interest on debt

b.Interest on equity

c.Trading on debt

d.Trading on equity

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

a.Capital market line

b.None of these

c.Asset market line

d.Security market line

79. 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

80. 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

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

a.Negative

b.Zero

c.Positive

d.Perfectly negative

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

a.Forward approach

b.Earnings approach

c.Risk approach

d.Backward approach

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

a.Capital return

b.None of these

c.Current return

d.Total return

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

a.Sales and leaseback

b.Leveraged lease

c.Direct leasing arrangement

d.Operating lease

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

a.Tangible Asset

b.Real Asset

c.Fictitious asset

d.Financial Asset

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

a.Profit and Loss

b.Planning and Leaving

c.Promoting and Liquidity

d.Premium and Liability

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

a.Cabinet Committee on Economic Affairs

b.Central Committee Exchange Act

c.Central Commerce Economic Affairs

d.Certified Commerce Exchange Act

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

a.Native Hidden Brokerage

b.Non Hiring Business

c.National Housing and Building Association

d.National Housing Bank

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

a.Yield to Debit

b.Yield of Divergence

c.Year-to-date

d.Year to Delivery

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

a.Credit on Option

b.Certified Operating Officer

c.Chief Operating Officer

d.Credit Operating Officer

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

a.Share Capital

b.All of these

c.Debt Capital

d.Trade Credit

92. Funds are financial resources in the form of:

a.Cash Equivalents

b.Business funds

c.Corporate Capital

d.All of these

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

a.Fast Credits on Conservative Basis

b.Food and Finance Corporation Board

c.Foreign Currency Convertible Bond

d.Financial Committee for Certified Business

94. The yield curve shows the relationship between:

a.Terms to maturaluty and price

b.Yield to maturity and price

c.None of these

d.Yield to maturity and terms to maturity

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

a.Default Risk

b.Financial Risk

c.Liquidity Risk

d.Call Risk

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

a.None of these

b.Technical analysis

c.Time series analysis

d.Cross sectional analysis

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

a.Available For Sale

b.Annual Financial Stock

c.Annual Foreign Stock

d.Available For Stock

98. Yield to maturity is what?

a.Current yield

b.Annual appreciation or depreciation

c.None of the above

d.Combination of current yield and annual apppreciation

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

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

b.None of these

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

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

100. Business finance deals with which of the following?

a.Procuring funds from different sources on fair terms

b.Both a and b

c.Utilize funds efficiently

d.None of these

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

General

Important Days

CBSE School Lessons

Popular Pages

Entrance Exams

Top Entrance Exams

Admission Information

Career and Jobs

Education India