Option A: Dividends
Option B: No dividends
Option C: Current price
Option D: Past price
Correct Answer: No dividends ✔
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Option A: Interest rate-tax savings
Option B: Marginal tax-required return
Option C: Interest rate + tax savings
Option D: Borrowing cost + embedded cost
Correct Answer: Interest rate-tax savings ✔
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Option A: Industry Beta
Option B: Market Beta
Option C: Subtracted Beta
Option D: Fundamental Beta
Correct Answer: Fundamental Beta ✔
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Cost of capital is equal to required return rate on equity in case if investors are only__________?
Option A: Valuation manager
Option B: Common stockholders
Option C: Asset seller
Option D: Equity dealer
Correct Answer: Common stockholders ✔
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Option A: Sunk cost
Option B: Occurred cost
Option C: Weighted cost
Option D: Mean cost
Correct Answer: Sunk cost ✔
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Option A: New expansion project
Option B: Old expanded project
Option C: Firm borrowing project
Option D: Product line selection
Correct Answer: New expansion project ✔
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Option A: Relevant cash flows
Option B: Irrelevant cash flows
Option C: Marginal cash flows
Option D: Transaction cash flows
Correct Answer: Relevant cash flows ✔
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Redemption option which protects investors against rise in interest rate is considered as________?
Option A: Redeemable at deferred
Option B: Redeemable at par
Option C: Redeemable at refund
Option D: Redeemable at finding
Correct Answer: Redeemable at par ✔
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Option A: Present value bond
Option B: Original issue discount bond
Option C: Coupon issued bond
Option D: Discounted bond
Correct Answer: Original issue discount bond ✔
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In capital budgeting, number of non-normal cash flows have internal rate of returns are__________?
Option A: One
Option B: Multiple
Option C: Accepted
Option D: Non-accepted
Correct Answer: Multiple ✔
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Option A: External rate of return
Option B: Internal rate of return
Option C: Positive rate of return
Option D: Negative rate of return
Correct Answer: Internal rate of return ✔
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Option A: Original period
Option B: Investment period
Option C: Payback period
Option D: Forecasted period
Correct Answer: Payback period ✔
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Option A: 16.75%
Option B: 2.68%
Option C: 0.37%
Option D: 9.20%
Correct Answer: 16.75% ✔
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Option A: Low riskier firms
Option B: High riskier firms
Option C: Low dividends paid
Option D: High marginal rate
Correct Answer: Low riskier firms ✔
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Option A: Short-term options
Option B: Long-term options
Option C: Short money options
Option D: Yearly call
Correct Answer: Long-term options ✔
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An option that gives investors right to sell a stock at predefined price is classified as__________?
Option A: Put option
Option B: Call option
Option C: Money back options
Option D: Out of money options
Correct Answer: Put option ✔
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An increase in value of option leads to low present value of exercise cost only if it has__________?
Option A: Low volatility
Option B: Interest rates are high
Option C: Interest rates are low
Option D: High volatility
Correct Answer: Interest rates are high ✔
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Option A: Longer option period
Option B: Smaller option period
Option C: Lesser price
Option D: Higher price
Correct Answer: Longer option period ✔
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Option A: Due option
Option B: Covered option
Option C: Undue option
Option D: Uncovered option
Correct Answer: Covered option ✔
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Option A: Put investor
Option B: Call investor
Option C: Hedger
Option D: Volatile hedge
Correct Answer: Hedger ✔
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Option A: Shorter call option
Option B: Longer call option
Option C: Longer put option
Option D: Shorter put option
Correct Answer: Longer call option ✔
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Option A: Option value equal to one
Option B: Option value will increase
Option C: Option value will decrease
Option D: Option value equal to zero
Correct Answer: Option value will increase ✔
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Option A: Discount rate
Option B: Transaction costs
Option C: No transaction costs
Option D: No discounts
Correct Answer: Transaction costs ✔
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Option A: Option lattice
Option B: Pricing movement
Option C: Price change
Option D: Binomial lattice
Correct Answer: Binomial lattice ✔
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Option A: Savings associations
Option B: Loans associations
Option C: Preferred and common associations
Option D: Savings and loans associations
Correct Answer: Savings and loans associations ✔
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Option A: Debit unions
Option B: Life insurance companies
Option C: Credit unions
Option D: Auto purchases
Correct Answer: Life insurance companies ✔
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Option A: Financial services corporations
Option B: Common service corporations
Option C: Preferred service corporations
Option D: Commercial service corporations
Correct Answer: Financial services corporations ✔
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Option A: International firm of auction system
Option B: International association of network dealers
Option C: National firm of equity dealers
Option D: National association of securities dealers
Correct Answer: National association of securities dealers ✔
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Option A: Exchange traded fund
Option B: Management expense
Option C: Money trade fund
Option D: Capital trade fund
Correct Answer: Exchange traded fund ✔
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Option A: Hiring problems
Option B: Agency problems
Option C: Corporation internal problems
Option D: Corporation external problems
Correct Answer: Agency problems ✔
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Option A: Budget surplus
Option B: Budget deficit
Option C: Federal reserve
Option D: Federal budget
Correct Answer: Budget surplus ✔
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Option A: U.S treasury bonds
Option B: Mortgages
Option C: Municipal bonds
Option D: Corporate bonds
Correct Answer: Municipal bonds ✔
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Option A: Unlimited liability partnership
Option B: Limited liability partnership
Option C: Controlled partnership
Option D: Uncontrolled partnership
Correct Answer: Limited liability partnership ✔
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Option A: Residential markets
Option B: Mortgage markets
Option C: Agriculture markets
Option D: Commercial markets
Correct Answer: Mortgage markets ✔
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Option A: Municipal bonds
Option B: Corporate bonds
Option C: U.S treasury bonds
Option D: Mortgages
Correct Answer: Mortgages ✔
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Option A: Saving intermediaries
Option B: Discounted intermediaries
Option C: Money market securities
Option D: Capital market securities
Correct Answer: Capital market securities ✔
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Option A: Intermediate term
Option B: Capital term
Option C: Short-term
Option D: Long-term
Correct Answer: Long-term ✔
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Option A: Average cost of capital
Option B: Mean cost of capital
Option C: Weighted cost of capital
Option D: Weighted average cost of capital
Correct Answer: Weighted average cost of capital ✔
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Option A: Money market securities
Option B: Capital market securities
Option C: Saving intermediaries
Option D: Discounted intermediaries
Correct Answer: ✔
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Option A: Debit funds
Option B: Credit funds
Option C: Mutual funds
Option D: Insurance funds
Correct Answer: Mutual funds ✔
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Option A: Financial markets
Option B: Corporate institutions
Option C: Hedge firms
Option D: Retirement planners
Correct Answer: Financial markets ✔
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Option A: Venture partners
Option B: Corporate partners
Option C: Limited partners
Option D: General partners
Correct Answer: Limited partners ✔
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Option A: Initial public offering
Option B: External public offering
Option C: Internal public offering
Option D: Unprofessional offering
Correct Answer: Initial public offering ✔
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Option A: Production opportunities
Option B: Risk
Option C: All of above
Option D: Inflation
Correct Answer: Inflation ✔
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Option A: Foreign trade
Option B: Foreign trade deficits
Option C: Foreign trade surplus
Option D: Trade surplus
Correct Answer: Foreign trade ✔
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Option A: Deposit cheque
Option B: Distribution cost
Option C: Short term treasury bills
Option D: Short term capital cost
Correct Answer: Short term treasury bills ✔
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Option A: Financial instruments
Option B: Financial asset markets
Option C: Physical asset markets
Option D: Easy markets
Correct Answer: Financial asset markets ✔
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Option A: Dollar bonds
Option B: Euro deposits
Option C: Eurodollar market deposits
Option D: Euro bonds
Correct Answer: Eurodollar market deposits ✔
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Relevant information about stock market price if it is given, then this price is called__________?
Option A: Market price
Option B: Intrinsic price
Option C: Extrinsic price
Option D: Unstable price
Correct Answer: Intrinsic price ✔
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Option A: Rate of return
Option B: Rate of exchange
Option C: Rate of intrinsic stock
Option D: Rate of extrinsic stock
Correct Answer: Rate of return ✔
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Option A: Dashed line
Option B: Straight line
Option C: Market line
Option D: Risk line
Correct Answer: Dashed line ✔
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Option A: $1,100
Option B: $3,400
Option C: $2,200
Option D: $3,500
Correct Answer: $1,100 ✔
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Option A: Accrued liabilities
Option B: Current liabilities
Option C: Accumulated liabilities
Option D: Non-current liabilities
Correct Answer: Current liabilities ✔
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Option A: Debt liabilities
Option B: Preferred stock
Option C: Hybrid stock
Option D: Common liabilities
Correct Answer: Preferred stock ✔
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Option A: Market values
Option B: Book values
Option C: Appreciated values
Option D: Depreciated values
Correct Answer: Market values ✔
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Option A: Annuity due
Option B: Payment fixed series
Option C: Ordinary annuity
Option D: Deferred annuity
Correct Answer: Annuity due ✔
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Option A: Accumulated depreciation
Option B: Depleted depreciation
Option C: Accumulated appreciation
Option D: Accumulated appreciation schedule
Correct Answer: Accumulated depreciation ✔
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Option A: Increased cash
Option B: Decreased cash
Option C: Increased liabilities
Option D: Increased equity
Correct Answer: Decreased cash ✔
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Option A: Semiannual discounting
Option B: Annual discounting
Option C: Annual compounding
Option D: Semiannual compounding
Correct Answer: Semiannual compounding ✔
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Option A: Annuity return
Option B: Deferred annuity return
Option C: Nominal rate
Option D: Semiannual discount rate
Correct Answer: Nominal rate ✔
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Option A: Extended life
Option B: Perpetuity
Option C: Deferred perpetuity
Option D: Due perpetuity
Correct Answer: Perpetuity ✔
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Option A: Hybrid stock
Option B: Common liabilities
Option C: Debt liabilities
Option D: Preferred stock
Correct Answer: Preferred stock ✔
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Option A: Increases liabilities
Option B: Increases equity
Option C: Increases cash
Option D: Decreases cash
Correct Answer: Increases cash ✔
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Option A: Compounding
Option B: Discounting
Option C: Money value
Option D: Stock value
Correct Answer: Discounting ✔
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Option A: Number of payment periods
Option B: Number of investment
Option C: Number of installments
Option D: Number of premium received
Correct Answer: Number of payment periods ✔
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Option A: Future value of perpetuity
Option B: Present value of perpetuity
Option C: Due perpetuity
Option D: Deferred perpetuity
Correct Answer: Present value of perpetuity ✔
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Option A: Not shown on timeline
Option B: Shown on timeline
Option C: Multiplied on timeline
Option D: Divided on timeline
Correct Answer: Shown on timeline ✔
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Option A: Cash flow of financing activities
Option B: Cash flow per share
Option C: Cash flow of investment
Option D: Cash flow of operations
Correct Answer: Cash flow per share ✔
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Option A: Fixed payment investment
Option B: Lump sum amount
Option C: Fixed interval investment
Option D: Annuity
Correct Answer: Annuity ✔
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Option A: Rises
Option B: Declines
Option C: Equals
Option D: None of above
Correct Answer: Rises ✔
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Option A: Inventories
Option B: Short-term investments
Option C: Cash equivalents
Option D: Long-term investments
Correct Answer: Cash equivalents ✔
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Option A: Annual percentage rate
Option B: Annual rate of return
Option C: Loan rate of return
Option D: Local rate of return
Correct Answer: Annual percentage rate ✔
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Option A: Amortized loan
Option B: Depreciated loan
Option C: Appreciated loan
Option D: Repaid payments
Correct Answer: Amortized loan ✔
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Option A: Depreciation
Option B: Amortization
Option C: Stock amortization
Option D: Perishable assets
Correct Answer: Amortization ✔
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An interest rate which is paid by money borrower and charged by lender is considered as__________?
Option A: Annual rate
Option B: Periodic rate
Option C: Perpetuity rate of return
Option D: Annuity rate of return
Correct Answer: Periodic rate ✔
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Option A: Tangible asset
Option B: Non-tangible assets
Option C: Financial asset
Option D: Financial liability
Correct Answer: Tangible asset ✔
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Option A: Free cash flow
Option B: Retained cash flow
Option C: Net cash flow
Option D: Financing cash flow
Correct Answer: Net cash flow ✔
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Option A: Last in first out
Option B: Last out receivable
Option C: First out receivable
Option D: First in first out
Correct Answer: First in first out ✔
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Option A: Non-cash revenues
Option B: Non-cash charges
Option C: Current liabilities
Option D: Income expense
Correct Answer: Non-cash charges ✔
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Option A: Investment return rate
Option B: Internal rate of return
Option C: International rate of return
Option D: Intrinsic rate of return
Correct Answer: Internal rate of return ✔
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Option A: Five years report
Option B: Annual report
Option C: Stock report
Option D: Exchange report
Correct Answer: Annual report ✔
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Securities with less predictable prices and have longer maturity time is considered as__________?
Option A: Cash equivalents
Option B: Long-term investments
Option C: Inventories
Option D: Short-term investments
Correct Answer: Short-term investments ✔
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Option A: Appreciation
Option B: Depreciation
Option C: Appreciated assets
Option D: Appreciated liabilities
Correct Answer: Depreciation ✔
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Option A: Preferred equity
Option B: Due equity
Option C: Common perpetuity
Option D: Common equity
Correct Answer: Common equity ✔
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Option A: Compounding
Option B: Discounting
Option C: Money value
Option D: Stock value
Correct Answer: Compounding ✔
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Option A: Net income
Option B: Net earnings
Option C: Net expenses
Option D: Net revenues
Correct Answer: Net income ✔
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Option A: Earning per share
Option B: Dividends per share
Option C: Book value of share
Option D: Market value of shares
Correct Answer: Earning per share ✔
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Stockholders that do not get benefits even if company’s earnings grow are classified as__________?
Option A: Preferred stockholders
Option B: Common stockholders
Option C: Hybrid stockholders
Option D: Debt holders
Correct Answer: Preferred stockholders ✔
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Option A: Current liabilities
Option B: Income expenses
Option C: Non-cash revenues
Option D: Non-cash charges
Correct Answer: Non-cash charges ✔
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Option A: Depreciation and amortization
Option B: Net sales
Option C: Net profit
Option D: Net income
Correct Answer: Depreciation and amortization ✔
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Option A: Not shown on timeline
Option B: Shown on timeline
Option C: Multiplied on timeline
Option D: Divided on timeline
Correct Answer: Not shown on timeline ✔
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Option A: Preferred stock account
Option B: Common stock account
Option C: Due stock account
Option D: Preceded stock account
Correct Answer: Common stock account ✔
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Option A: 27%
Option B: 12%
Option C: 19.50%
Option D: none of above
Correct Answer: 12% ✔
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Option A: Alpha coefficient
Option B: Beta coefficient
Option C: Stand-alone coefficient
Option D: Relevant coefficient
Correct Answer: Beta coefficient ✔
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Option A: Average rate of return
Option B: Expected rate of return
Option C: Past rate of return
Option D: Weighted rate of return
Correct Answer: Expected rate of return ✔
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Option A: Risk taking
Option B: Risk aversion
Option C: Market aversion
Option D: Portfolio aversion
Correct Answer: Risk aversion ✔
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Option A: Alpha
Option B: Beta
Option C: Variance
Option D: Market relevance
Correct Answer: Beta ✔
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Option A: Negativity
Option B: Positivity
Option C: Correlation
Option D: Diversification
Correct Answer: Diversification ✔
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