Finance MCQs

Page No. 2

Project which is started by firm for increasing sales is classified as______________?


aNew expansion project

✓


bOld expanded project

✖


cFirm borrowing project

✖


dProduct line selection

✖


View Answer New expansion project

Cash flows that should be considered for decision in hand are classified as____________?


aRelevant cash flows

✓


bIrrelevant cash flows

✖


cMarginal cash flows

✖


dTransaction cash flows

✖


View Answer Relevant cash flows

Redemption option which protects investors against rise in interest rate is considered as________?


aRedeemable at deferred

✖


bRedeemable at par

✓


cRedeemable at refund

✖


dRedeemable at finding

✖


View Answer Redeemable at par

Bond which is offered below its face value is classified as______________?


aPresent value bond

✖


bOriginal issue discount bond

✓


cCoupon issued bond

✖


dDiscounted bond

✖



In capital budgeting, number of non-normal cash flows have internal rate of returns are____________?


aOne

✖


bMultiple

✓


cAccepted

✖


dNon-accepted

✖


View Answer Multiple

In capital budgeting, an internal rate of return of project is classified as its__________?


aExternal rate of return

✖


bInternal rate of return

✓


cPositive rate of return

✖


dNegative rate of return

✖



An uncovered cost at start of year is divided by full cash flow during recovery year then added in prior years to full recovery for calculating__________?


aOriginal period

✖


bInvestment period

✖


cPayback period

✓


dForecasted period

✖


View Answer Payback period

Return on assets = 6.7% and equity multiplier = 2.5% then return on equity will be ______________?


a16.75%

✓


b2.68%

✖


c0.37%

✖


d9.20%

✖


View Answer 16.75%

Low price for earnings ratio is result of________________?


aLow riskier firms

✓


bHigh riskier firms

✖


cLow dividends paid

✖


dHigh marginal rate

✖


View Answer Low riskier firms

Long-term equity anticipation security is usually classified as__________?


aShort-term options

✖


bLong-term options

✓


cShort money options

✖


d Yearly call

✖


View Answer Long-term options

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