Financial Management MCQs

Option A: Coefficient of market

Option B: Relative to market

Option C: Ir-relative to market

Option D: Same with market

Correct Answer: Relative to market ✔

Option A: Security market line

Option B: Required return line

Option C: Market risk line

Option D: Riskier return line

Correct Answer: Security market line ✔

Option A: Correlation

Option B: Move tendency

Option C: Variables tendency

Option D: Double tendency

Correct Answer: Correlation ✔

Option A: Probability

Option B: Risk

Option C: Chance

Option D: Event happening

Correct Answer: Probability ✔

Option A: Risk factors

Option B: Premium factors

Option C: Bond buying factors

Option D: Multi model

Correct Answer: Risk factors ✔

Option A: Tendency coefficient

Option B: Variable coefficient

Option C: Correlation coefficient

Option D: Double coefficient

Correct Answer: Correlation coefficient ✔

Option A: High beta, less risky

Option B: Low beta, more risky

Option C: High beta, more risky

Option D: Low beta, less risky

Correct Answer: High beta, more risky ✔

Option A: Chance

Option B: Event happening

Option C: Probability

Option D: Risk

Correct Answer: Risk ✔

Option A: Risk

Option B: Return

Option C: Deviation

Option D: Both A and B

Correct Answer: Both A and B ✔

Option A: Higher risk

Option B: Lower risk

Option C: Expected risk

Option D: Peaked risk

Correct Answer: Lower risk ✔

Option A: Coefficient of variation

Option B: Coefficient of deviation

Option C: Coefficient of standard

Option D: Coefficient of return

Correct Answer: Coefficient of variation ✔

Option A: Low variation

Option B: Low beta

Option C: High beta

Option D: High variation

Correct Answer: Low beta ✔

Option A: Stock risk

Option B: Portfolio risk

Option C: Diversifiable risk

Option D: Market risk

Correct Answer: Diversifiable risk ✔

Option A: Market portfolio

Option B: Return portfolio

Option C: Correlated portfolio

Option D: Diversified portfolio

Correct Answer: Market portfolio ✔

Option A: Coefficient risk volatility

Option B: Market risk volatility

Option C: Stock market volatility

Option D: Portfolio market portfolio

Correct Answer: Stock market volatility ✔

Option A: Patents premium

Option B: Competition premium

Option C: Company’s beta

Option D: Expiry premium

Correct Answer: C. Company’s beta ✔

Option A: Multiple risk stock

Option B: Varied risk stock

Option C: Total risk stock

Option D: Average risk stock

Correct Answer: Average risk stock ✔

Option A: Long-termed

Option B: Short-termed

Option C: Riskier

Option D: Smaller

Correct Answer: Smaller ✔

Option A: Sharpe’s alpha

Option B: Standard alpha’s

Option C: Alpha’s variance

Option D: Variance

Correct Answer: Variance ✔

Option A: Coefficient of variation

Option B: Coefficient of deviation

Option C: Coefficient of standard

Option D: Coefficient of return

Correct Answer: Coefficient of variation ✔

Option A: Quoted rate

Option B: Unquoted rate

Option C: Steeper rate

Option D: Portfolio rate

Correct Answer: Quoted rate ✔

Option A: Riskier finance

Option B: Behavioral finance

Option C: Premium finance

Option D: Buying finance

Correct Answer: Behavioral finance ✔

Option A: Diversifiable risk

Option B: Market risk

Option C: Stock risk

Option D: Portfolio risk

Correct Answer: Market risk ✔

Option A: Equal to original price

Option B: Equal to sum of stocks

Option C: Less than original price

Option D: Greater than original price

Correct Answer: Greater than original price ✔

Option A: High market to book ratio

Option B: Low book to market ratio

Option C: Low market to book ratio

Option D: High book to market ratio

Correct Answer: Low book to market ratio ✔

Option A: No taxes

Option B: No transaction costs

Option C: Fixed quantities of assets

Option D: All of above

Correct Answer: All of above ✔

Option A: Non-linear

Option B: Linear

Option C: Fixed and aggregate

Option D: Non-fixed and non-aggregate

Correct Answer: Linear ✔

Option A: Efficient money hypothesis

Option B: Efficient market hypothesis

Option C: Inefficient market hypothesis

Option D: Inefficient money hypothesis

Correct Answer: Efficient market hypothesis ✔

Option A: Regression line

Option B: Probability line

Option C: Scattered points

Option D: Weighted line

Correct Answer: Regression line ✔

Option A: Standard betas

Option B: Varied betas

Option C: Historical betas

Option D: Adjusted betas

Correct Answer: Adjusted betas ✔

Option A: Tax free pricing model

Option B: Cost free pricing model

Option C: Capital asset pricing model

Option D: Stock pricing model

Correct Answer: Capital asset pricing model ✔

Option A: Low market to book ratio

Option B: High book to market ratio

Option C: High market to book ratio

Option D: Low book to market ratio

Correct Answer: High book to market ratio ✔

Option A: Identical

Option B: Not identical

Option C: Fixed

Option D: Variable

Correct Answer: Identical ✔

Option A: Given and fixed

Option B: Not given and fixed

Option C: Not given and variable

Option D: Given and variable

Correct Answer: Given and fixed ✔

Option A: Identical and fixed returns

Option B: Risk free rate of interest

Option C: Fixed rate of interest

Option D: Risk free expected return

Correct Answer: Risk free rate of interest ✔

A. HML portfolio
B. R portfolio
C. Subtracted portfolio

Correct Answer: HML portfolio ✔

Option A: Standard deviation

Option B: Variance

Option C: Aggregate risk

Option D: Ineffective risk

Correct Answer: Standard deviation ✔

Option A: Experienced

Option B: Inexperienced

Option C: Pessimistic

Option D: Optimistic

Correct Answer: Optimistic ✔

Option A: More risky

Option B: Less risky

Option C: Pessimistic

Option D: Optimistic

Correct Answer: More risky ✔

Option A: Attained frontier

Option B: Efficient frontier

Option C: Inefficient frontier

Option D: Unattainable frontier

Correct Answer: Efficient frontier ✔

Option A: Optimistic

Option B: More risky

Option C: Less risky

Option D: Pessimistic

Correct Answer: Less risky ✔

Option A: Aggregate risk

Option B: Remaining risk

Option C: Effective risk

Option D: Ineffective risk

Correct Answer: Remaining risk ✔

Option A: Pessimistic

Option B: Optimistic

Option C: Experienced

Option D: Inexperienced

Correct Answer: Pessimistic ✔

Option A: Probability error

Option B: Actual error

Option C: Prediction error

Option D: Random error

Correct Answer: Random error ✔

Option A: Individual

Option B: Collective

Option C: Weighted

Option D: Linear

Correct Answer: Individual ✔

Option A: Historical betas

Option B: Adjusted betas

Option C: Standard betas

Option D: Varied betas

Correct Answer: Historical betas ✔

Option A: Eurodollar market deposits

Option B: Commercial loans

Option C: Consumer credit loans

Option D: Consumer credit loans

Correct Answer: Commercial loans ✔

Option A: Stock market

Option B: Dealer market

Option C: Outcry auction system

Option D: Face to face communication

Correct Answer: Dealer market ✔

Option A: Non-financial intermediary

Option B: Financial intermediary

Option C: Savers intermediary

Option D: Discounted intermediary

Correct Answer: Financial intermediary ✔

Option A: Cost of production

Option B: Cost of money

Option C: Opportunity cost

Option D: Inflation risk

Correct Answer: Cost of money ✔

Option A: Money market funds

Option B: Capital market funds

Option C: Money mutual funds

Option D: Insurance money funds

Correct Answer: Money market funds ✔

Option A: Electronic communication network

Option B: Electronic dealer network

Option C: Electronic stock network

Option D: Electronic order network

Correct Answer: Electronic communication network ✔

Option A: Consumer credit loans

Option B: Dollar bonds

Option C: Eurodollar market deposits

Option D: Euro bonds

Correct Answer: Consumer credit loans ✔

Option A: Primary markets

Option B: Capital markets

Option C: Physical asset markets

Option D: All of above

Correct Answer: All of above ✔

Option A: Leases

Option B: Preferred stocks

Option C: Common stocks

Option D: Corporate stocks

Correct Answer: Common stocks ✔

Option A: Capital markets

Option B: Money markets

Option C: Liquid markets

Option D: Short-term markets

Correct Answer: Money markets ✔

Option A: Customer’s acceptance

Option B: Banker’s acceptance

Option C: Federal acceptance

Option D: Treasury acceptance

Correct Answer: B. Banker’s acceptance ✔

Option A: General professionals

Option B: Professional corporation

Option C: Professional association

Option D: Both B and C

Correct Answer: Both B and C ✔

Option A: Physical asset markets

Option B: Intangible assets

Option C: Competitive markets

Option D: Easy markets

Correct Answer: Physical asset markets ✔

Option A: Common stocks

Option B: Corporate stocks

Option C: Leases

Option D: Preferred stocks

Correct Answer: Preferred stocks ✔

Option A: Short-term

Option B: Long-term

Option C: Intermediate term

Option D: Capital term

Correct Answer: Intermediate term ✔

Option A: Future funds

Option B: Hedge funds

Option C: Retirement funds

Option D: Pension funds

Correct Answer: Hedge funds ✔

Option A: Market price

Option B: Intrinsic price

Option C: Extrinsic price

Option D: Fundamental price

Correct Answer: Market price ✔

Option A: Original trading

Option B: Liquidity

Option C: Offline trading

Option D: Fixed price trading

Correct Answer: Liquidity ✔

Option A: Leases

Option B: Preferred stocks

Option C: Common stocks

Option D: Corporate stocks

Correct Answer: Leases ✔

Option A: Limited corporate business

Option B: Unlimited corporate business

Option C: Controlled corporate business

Option D: Corporation

Correct Answer: Corporation ✔

Option A: Interest rate

Option B: Cost of equity

Option C: Debt rate

Option D: Investment return

Correct Answer: Cost of equity ✔

Option A: Liability plan

Option B: Stock planning

Option C: Corporation paperwork

Option D: Charter

Correct Answer: Charter ✔

Option A: Treasury bills

Option B: Commercial paper

Option C: Negotiable certificate of deposit

Option D: Money market mutual funds

Correct Answer: Money market mutual funds ✔

Option A: Agent bonds

Option B: Development bonds

Option C: Pollution control bonds

Option D: Both B and C

Correct Answer: Both B and C ✔

Option A: Income risk

Option B: Investment risk

Option C: Reinvestment risk

Option D: Mature risk

Correct Answer: Reinvestment risk ✔

Option A: At par value

Option B: Below its par value

Option C: More than its par value

Option D: Seasoned par value

Correct Answer: At par value ✔

Option A: More price changes

Option B: Stable prices

Option C: Standing prices

Option D: Mature prices

Correct Answer: More price changes ✔

Option A: External return method

Option B: Net present value of method

Option C: Net future value method

Option D: Internal return method

Correct Answer: Net present value of method ✔

Option A: Price will be lower

Option B: Rate will be higher

Option C: Price will be higher

Option D: Rate will be lower

Correct Answer: Price will be higher ✔

Option A: Future value of portfolio

Option B: Current value of stock

Option C: Future value of stock

Option D: Present value of portfolio

Correct Answer: Current value of stock ✔

Option A: Cost of debt

Option B: Cost of equity

Option C: Cost of internal capital

Option D: Cost of reserve assets

Correct Answer: Cost of debt ✔

Option A: Present value ratio

Option B: Future value ratio

Option C: Retention ratio

Option D: Growth ratio

Correct Answer: Retention ratio ✔

Option A: Industry cannot control

Option B: Industry cannot control

Option C: Firm must control

Option D: Firm cannot control

Correct Answer: Firm cannot control ✔

Option A: Yearly method

Option B: Single methods

Option C: Double methods

Option D: Accelerated methods

Correct Answer: Accelerated methods ✔

Option A: Accelerated

Option B: Equal

Option C: Different

Option D: Inflated

Correct Answer: Equal ✔

Option A: Equity effects

Option B: Debt effects

Option C: Inflation effects

Option D: Opportunity effects

Correct Answer: Inflation effects ✔

Option A: Relevant inflows

Option B: Free cash flow

Option C: Relevant outflows

Option D: Cash outlay

Correct Answer: Free cash flow ✔

Option A: Cash charge

Option B: Non cash charge

Option C: Cash flow discounts

Option D: Net salvage discount

Correct Answer: Non cash charge ✔

Option A: Weighted average cost of interest

Option B: Weighted average cost of capital

Option C: Weighted average salvage value

Option D: Mean cost of capital

Correct Answer: Weighted average cost of capital ✔

Option A: No inflation

Option B: High inflation

Option C: No transactions

Option D: No acceleration

Correct Answer: No inflation ✔

Option A: Cost of salvage

Option B: Cost of interest

Option C: Cost of taxation

Option D: Cost of capital

Correct Answer: Cost of capital ✔

Option A: Expansion

Option B: Salvages

Option C: Taxation

Option D: Discounts

Correct Answer: Taxation ✔

Option A: Inflation effects

Option B: Opportunity effects

Option C: Equity effects

Option D: Debt effects

Correct Answer: Inflation effects ✔

Option A: Irrelevant cash flow

Option B: Relevant cash flow

Option C: Incremental cash flow

Option D: Decrease cash flow

Correct Answer: Incremental cash flow ✔

Option A: Occurred cost

Option B: Mean cost

Option C: Opportunity costs

Option D: Weighted cost

Correct Answer: Opportunity costs ✔

Option A: Mature expected return rate

Option B: Lower than expected return rate

Option C: Higher than expected return rate

Option D: Equal to expected return rate

Correct Answer: Equal to expected return rate ✔

Option A: Going rate of return

Option B: Yield

Option C: Earning rate

Option D: Both A and B

Correct Answer: Both A and B ✔

Option A: Artificial provision

Option B: Call provision

Option C: Redeem provision

Option D: Original provision

Correct Answer: Call provision ✔

Option A: Increased

Option B: Decreased

Option C: Earned

Option D: Never changed

Correct Answer: Increased ✔

Option A: Borrowed bond

Option B: Purchasing power bond

Option C: Surplus bond

Option D: Deficit bond

Correct Answer: Purchasing power bond ✔

Option A: More than its par value

Option B: Seasoned par value

Option C: At par value

Option D: Below its par value

Correct Answer: Below its par value ✔

Option A: Debt cost

Option B: Relevant cost

Option C: Borrowing cost

Option D: Embedded cost

Correct Answer: Relevant cost ✔

Option A: Expected risk

Option B: Beta risk

Option C: Industry risk

Option D: Returning risk

Correct Answer: Beta risk ✔

Option A: Expected risk

Option B: Stand-alone risk

Option C: Variable risk

Option D: Returning risk

Correct Answer: Stand-alone risk ✔