Business Finance MCQs

Question 1

Which is the most popular technique of working capital forecast?

Accepted Answer

Both A and B

Answer

Cash forecasting method

Answer

Adjusted profit and loss method

Answer

None of the above

Question 2

Which one of the following is not the objective of UTI?

Accepted Answer

To provide finance under hire purchase finance and housing finance to its members

Answer

To motility savings of the community by offering savers the triple benefits of safety, liquidity, and profitability of investments

Answer

To channelize the pooled savings into productive outlets

Answer

To give everyone a chance to indirectly own shares and securities in a large number of select companies

Question 3

Opportunity cost refers to

Accepted Answer

The cost forgone in favour of the production of another product

Answer

Variable Cost

Answer

Short-run cost

Answer

Cost related to an optimum level of production

Question 4

Net working capital is the excess of current assets over

Accepted Answer

current liabilities

Answer

total liabilities

Answer

intangible liabilities

Answer

None of these

Question 5

Which is a payment of additional shares to shareholders in lieu of cash?

Accepted Answer

Stock dividend

Answer

Stock split

Answer

Extra dividend

Answer

Regular dividend

Question 6

The cost debt financing is generally . . . . . . . . the cost preferred or common equity financing.

Accepted Answer

less than

Answer

equal to

Answer

more than

Answer

None of the above

Question 7

The point of tangency between risk return indifferences curves and efficient frontier highlights.

Accepted Answer

Optimal portfolio

Answer

Efficient portfolio

Answer

Sub-optimal portfolio

Answer

None of the above

Question 8

Which of the following is not the internal factor affecting the weighted average cost of capital of a firm?

Accepted Answer

Market risk premium for the firm

Answer

Investment policy of the firm

Answer

Capital structure of the firm

Answer

Dividend policy followed

Question 9

Loans to limited companies

Accepted Answer

Have a fixed term and receive interest allowable for corporation tax, but have no voting rights

Answer

Do not have a fixed term, but receive interest allowable for corporation tax and have voting rights

Answer

Do not have a fixed term and receive interest allowable for corporation tax, but have no voting rights

Answer

Have a fixed term and receive interest not allowable for corporation tax, but have no voting rights