This quiz works best with JavaScript enabled. Home > Management > Financial Management > Financial Management – Quiz 78 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Financial Management Quiz 78 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which factor does not effect the dividend decision A) Rate of dividend. B) History of dividend. C) Rate of dividend of the competitor firm. D) Risk. Show Answer Correct Answer: D) Risk. 2. What is it called when a person or business is unable to pay their debts? A) Secured debt. B) Bankruptcy. C) Total assets. D) Debt consolidation. E) Unsecured debt. Show Answer Correct Answer: B) Bankruptcy. 3. Minimum rate of return that a project must earn to increase firm value A) Cost of capital. B) Cost of opportunity. C) Implicit cost. D) Quality cost. Show Answer Correct Answer: A) Cost of capital. 4. ..... are documents that are used to report information about the business at the end of the accounting cycle. A) Income statements. B) Financial statements. C) Accounts payables. D) Current assets. Show Answer Correct Answer: B) Financial statements. 5. Funds raised from this source dilutes management's holding A) Debentures. B) Preference shares. C) Equity shares. D) None. Show Answer Correct Answer: C) Equity shares. 6. ..... type of financing is usually done for financing high risky businesses A) Leasing. B) Venture capital. C) Hire purchase. D) Factoring. Show Answer Correct Answer: B) Venture capital. 7. Which TWO of the following are examples of financial objectives that a company might choose to pursue? A. Dealing honestly and fairly with customers on all occasions B. Provision of good working conditions and industrial relations C. Earning above a particular level of return on capital employed D. Producing environmentally friendly products E. Restricting the level of gearing to below a specified target level A) B & D. B) A & C. C) C & E. D) A & E. Show Answer Correct Answer: C) C & E. 8. Housing is an example of which of the following: A) Need. B) Want. C) Income. D) Desire. Show Answer Correct Answer: A) Need. 9. What does the concept of 'present value' in time value of money calculations refer to? A) The future worth of money. B) The value of money in the present. C) The value of money in the future. D) The total monetary assets of a company. Show Answer Correct Answer: B) The value of money in the present. 10. ..... is the present value of an asset less all claims against it. A) Capital. B) Property. C) Equity. D) Asset. Show Answer Correct Answer: C) Equity. 11. The amount of money left after all deductions have been taken from the gross pay earned in a pay period is called? A) Gross pay. B) Overtime pay. C) Pay period. D) Net pay. Show Answer Correct Answer: D) Net pay. 12. Which of the following is not a source of external financing for a public limited company? A) Overdraft. B) Debentures. C) Retained profit. D) Share capital. Show Answer Correct Answer: C) Retained profit. 13. While designing capital structure a finance manager should choose a pattern of capital which- A) Minimizes cost of capital. B) Maximizes the owners return. C) Maximizes cost of capital and minimizes owners return. D) Both (a) and (b). Show Answer Correct Answer: D) Both (a) and (b). 14. Also known as errors and omissions (E&O) insurance. It protects you against negligence claims arising from harm that results from mistakes or failure to perform A) Property insurance. B) Workers' compensation insurance. C) Professional liability insurance. D) None of above. Show Answer Correct Answer: C) Professional liability insurance. 15. The sources of finance from which the quantum of required funds can be raised is/are: A) Share capital. B) Trade credit. C) Debt capital. D) All of these. Show Answer Correct Answer: D) All of these. 16. The management of money and financial decisions for a person or family including budgeting, investments, retirement planning and investments is ..... A) Investment. B) Personal Finance. C) Economics. D) Savings. Show Answer Correct Answer: B) Personal Finance. 17. It also deals with financial decisions such as when to introduce a new product, when to invest in new assets, when to replace existing assets, when to borrow from banks, when to issue stocks or bonds, when to extend credit to a customer, and how much cash to maintain. A) FINANCIAL MANAGEMENT. B) FINANCIAL STATEMENT. Show Answer Correct Answer: A) FINANCIAL MANAGEMENT. 18. Using the NPV approach, an investment is lucrative when the: A) Aggregate free cash flows to all capital providers discounted by the cost of equity is higher than total invested capital. B) Aggregate free cash flows to equity capital providers discounted by the weighted average cost of capital is higher than total invested capital. C) Aggregate free cash flows to equity capital providers discounted by the cost of equity is higher than total invested capital. D) Aggregate free cash flows to equity capital providers discounted by the cost of equity is higher than invested equity capital. Show Answer Correct Answer: D) Aggregate free cash flows to equity capital providers discounted by the cost of equity is higher than invested equity capital. 19. The IRR is the discount rate that produces a zero NPV or the specific discount rate at which the present value of the cost equals ..... A) The future value of the present cash outflows. B) The present value of the future benefits or cash inflows. C) The present value of the cash outflow. D) The investment. Show Answer Correct Answer: B) The present value of the future benefits or cash inflows. 20. Deals with Opportunity Cost A) Money Has Time Value. B) Risk Return Trade Off. C) Cash Flows Are Source of Values. D) Market Prices Reflect Information. Show Answer Correct Answer: A) Money Has Time Value. ← PreviousNext →Related QuizzesManagement QuizzesFinancial Management Quiz 1Financial Management Quiz 2Financial Management Quiz 3Financial Management Quiz 4Financial Management Quiz 5Financial Management Quiz 6Financial Management Quiz 7Financial Management Quiz 8Financial Management Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books