This quiz works best with JavaScript enabled. Home > Business Finance > Business Finance > Business Finance – Quiz 41 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Business Finance Quiz 41 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Advantage of sale of inventory as a source of finance A) This source of finance is not available for a newly formed businesses and unprofitable and under profitable firms. B) A good way of raising cash from capital that may be tied up in assets that are not being used. C) Must be repaid. D) Reduces storage cost of high inventory. Show Answer Correct Answer: D) Reduces storage cost of high inventory. 2. This source of business finance is used for issue of bonus shares: A) Equity Share. B) Preference Share. C) Retained Earnings. D) Debentures. Show Answer Correct Answer: C) Retained Earnings. 3. When an asset loses value over time it is called? A) Salvage. B) Net Loss. C) Depreciation. D) Dispose. Show Answer Correct Answer: C) Depreciation. 4. Banco De Oro, Bank of Philippine Island and Metropolitan Bank is an example of .....? A) Central Bank. B) Commercial Bank. C) Investment Bank. D) Thrift Bank. Show Answer Correct Answer: B) Commercial Bank. 5. Who established IKEA at the age of 17? A) Ingrid Bergman. B) Bella Weems. C) Ingvar Kamprad. D) Philo Farnsworth. Show Answer Correct Answer: C) Ingvar Kamprad. 6. Debentures can best be described as a form of A) Short-term loan with variable interest rates. B) Medium-term loan with variable interest rates. C) Long-term loan with a fixed interest rate. D) Long term security giving the holder part ownership of the business. Show Answer Correct Answer: C) Long-term loan with a fixed interest rate. 7. Wealthy individuals who invest in high-potential businesses are ..... A) Banks. B) Angel Investors. C) Shareholders. D) Crowdfunders. Show Answer Correct Answer: B) Angel Investors. 8. Financial institution controlled by the government. A) Securities Dealers/Brokers. B) Government Banks. C) Thrift Banks. D) Credit Union. Show Answer Correct Answer: B) Government Banks. 9. What is the name of the type of capital which is obtained by people buying a part of a company? A) Share Capital. B) Spare Capital. C) Owners' capital. D) None of above. Show Answer Correct Answer: A) Share Capital. 10. You have been offered an investment that promises to double your money every nine years. Considering the rule of 72, what is your approximate rate of return on the investment? A) 8%. B) 9%. C) 14%. D) 10%. Show Answer Correct Answer: A) 8%. 11. It is the borrower's security pledge for the loan payment. A) Character. B) Capacity. C) Collateral. D) Condition. Show Answer Correct Answer: C) Collateral. 12. Mark is needing to purchase a new van, which source of finance would you suggest? A) Bank loan. B) Mortgage. C) Hire purchase. D) Debenture. Show Answer Correct Answer: C) Hire purchase. 13. A rights issue involves the sale of what? A) New shares on the stock market. B) Fixed assets. C) New shares to existing shareholders. D) Part of the business. Show Answer Correct Answer: C) New shares to existing shareholders. 14. Cash and profit are different because ..... A) Some goods are sold on credit. B) Owners put more money into their business. C) The opening balance at the start of the year is zero. D) Companies might buy fixed assets. Show Answer Correct Answer: C) The opening balance at the start of the year is zero. 15. Which is a characteristic of good customer service? A) Asking many questions. B) Offending people. C) Offering quality service. D) Taking a long time to reply. Show Answer Correct Answer: C) Offering quality service. 16. Provide assistance to both private and public borrowers of fund A) Public finance. B) Capital market. C) Private finance. D) Business finance. Show Answer Correct Answer: B) Capital market. 17. Why have a business plan? A) Describes the nature of your business. B) Explains who will run your business. C) States how the business will win over and retain customers. D) All of the above. Show Answer Correct Answer: D) All of the above. 18. An obligation whose maturity is more than a year. The borrower generally negotiates with the credit rather than go to an investing banker to act as an intermediary. A) Long Term Loan. B) Term Loan. C) Mortgage Loan. D) Short Term Loan. Show Answer Correct Answer: B) Term Loan. 19. Which of the following financial instruments are available from commercial banks? A) Gilts. B) Commercial paper. C) Certificates of deposit. D) Treasury bills. Show Answer Correct Answer: C) Certificates of deposit. 20. The amount producers are willing and able to produce A) Demand. B) Scarcity. C) Supply. D) Inventory. Show Answer Correct Answer: C) Supply. ← PreviousNext →Related QuizzesBusiness Finance QuizzesBusiness Finance Quiz 1Business Finance Quiz 2Business Finance Quiz 3Business Finance Quiz 4Business Finance Quiz 5Business Finance Quiz 6Business Finance Quiz 7Business Finance Quiz 8Business Finance Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books