Financial Management | Chapter 4 | Part 1 | MBA MCQs | FM

Finacial Management MCQs

  

1 / 20

1. The residual reserve after the proposal capitalization% of the increased paid up capital of the company ____________.
   1.   60% .
   2.   50%.
   3.   20%
   4.   40%
2. While evaluating capital investment proposal the time value of money is considered in case of ____________.
   1.   Pay back method
   2.   Discounted cash flow.
   3.   Internal rate.
   4.   Accounting rate
3. Dividend policy of a firm affects both the long time financing and____________. wealth
   1.   Creditors.
   2.   Debtor
   3.   Shareholders
   4.   Owners .
4. ___________is the distribution of the profits of a company among its shareholders
   1.   Dividend.
   2.   Commission
   3.   Shares.
   4.   Interest.
5. Which of the following is not an objective of financial management?
   1.   Mobilization of funds at an acceptable cost..
   2.   Maximization of wealth of shareholders
   3.   Maximization of profits
   4.   Ensuring discipline in the organization..
6. The notice to Accept right share should not be less than ____________. days
   1.   20
   2.   10
   3.   15
   4.   30
7. The bonus issue is permitted to be made out of ____________ and premium collected in cash
   1.   free bonus.
   2.   free reserves.
   3.   free cash dividend.
   4.   free interest
8. Premium received in cash is a source of ____________ issue .
   1.   Résumés
   2.   Bonus.
   3.   Right.
   4.   Cash.
9. Which of the following are feature(s) of Gilt-edged securities?
   1.   They are issued by non-governmental service organizations.
   2.   Only repayment of principal is secured
   3.   The repayments of both principal and interest are secured.
   4.   They are issued by government entities.
10. Depreciation is include in costs in case of ____________.
    1.   Present value method.
    2.   Pay back method.
    3.   Accounting rate
    4.   Discounted cash flow
11. Which of the following statements represents the financing decision of a company?
    1.   Procuring new machineries for the R&D activities
    2.   Purchasing a new building at Delhi to open a regional office
    3.   Adopting state of the art technology to reduce the cost of production.
    4.   Spending heavily for the advertisement of the product of the company
12. The risk that arises due to change in the purchasing power is called __________Business risk
    1.   Business risk
    2.   Financial risk
    3.   Interest rate risk.
    4.   Inflation risk.
13. The return after the pay off period is not considered in case of ____________.
    1.   Interest rate method.
    2.   Discounted cash flow method
    3.   Present value method
    4.   Pay back period method .
14. Which of the following is a function of the finance manager
    1.   Control over the uses of funds
    2.   Mobilizing funds
    3.   Risk returns trade off.
    4.   Deployment of funds.
15. Financial risk arises due to the ____________.
    1.   leverage used by the company
    2.   liquidity of the assets of the company
    3.   changes in prevailing interest rates in the market.
    4.   variability of returns due to fluctuations in the securities market
16. Which of the following is not a function performed by a financial system?
    1.   Liquidity function
    2.   Savings function
    3.   Risk function
    4.   Social function.
17. Bonus share are not permitted unless the ____________paid shares ,if any made fully paid
    1.   not.
    2.   fully.
    3.   semi.
    4.   partly.
18. The arbitrary process is the behavioral foundation for the ____________.
    1.   XX approach.
    2.   MM approach
    3.   Miller approach
    4.   Gorder approach.
19. Which of the following is not a function of a finance manager?
    1.   Deployment of funds
    2.   Mobilization of funds
    3.   Manipulate share price of the company
    4.   Control over use of funds
20. The market value of the firm is the result of ____________.
    1.   trade-off between cost and risk.
    2.   working capital decisions.
    3.   capital budgeting decisions
    4.   dividend decisions