Finance MCQs

Page No. 34

In case of international business which of the given factor(s) must be considered?


aRole of foreign exchange


bBalance of payments


cAttitude of Governments


d All of the given options



If you have Rs. 850 and you plan to save it for 4 years with an interest rate of 10%, what will be the future value of your savings?


aRs. 1,000


bRs. 1,244


cRs. 1,331


dRs. 1,464


View Answer Rs. 1,244

Which of the following measure reveals how much profit a company generates with the money shareholders have invested?


aProfit Margin


bReturn on Assets


cReturn on Equity


dDebt-Equity Ratio


View Answer Return on Equity

A firm reports total liabilities of Rs. 300,000 and owner’s equity of Rs. 500,000. What would be the total worth of the firm’s assets?


aRs. 300,000


bRs. 500,000


cRs. 800,000


dRs. 1100,000


View Answer Rs. 800,000

Which of the following statement is TRUE regarding debt?


aDebt is an ownership interest in the firm.


bUnpaid debt can result in bankruptcy or financial failure.


cDebt provides the voting rights to the bondholders.


dCorporation’s payment of interest on debt is fully taxable.



If you plan to save Rs. 5,000 with a bank at an interest rate of 8%, what will be the worth of your amount after 4 years if interest is compounded annually?


aRs. 5,400


bRs. 5,900


cRs. 6,600


dRs. 6,802


View Answer Rs. 6,802

Which of the following statement about bond ratings is TRUE?


aBond ratings are typically paid for by a company’s bondholders.


bBond ratings are based solely on information acquired from sources other than the bond issuer.


cBond ratings represent an independent assessment of the credit-worthiness of bonds.


dNone of the given options



Which of the following ratios is NOT from the set of Asset Management Ratios?


aInventory Turnover Ratio


bReceivable Turnover


cCapital Intensity Ratio


dReturn on Assets



A firm has paid out Rs. 150,000 as dividends from its net income of Rs. 250,000. What is the retention ratio for the firm?


a12%


b25%


c40%


d60%


View Answer 40%

The most important item that can be extracted from financial statements is the actual ________ of the firm.


aNet Working Capital


bCash Flow


cNet Present Value


dNone of the given options


View Answer Cash Flow

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