Chapter-wise MCQ Questions

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Question-1. Investors who want steady income may not prefer ____________

  1. Equity Shares
  2. Debentures
  3. None of the above
  4. Bonds
Answer-1

Question-2. Money obtained by issue of shares is known as ___________

  1. Loans
  2. Reserve Funds
  3. Share Capital
  4. Debts
Answer-2

Question-3. ICICI was established in _________________

  1. 1975
  2. 1965
  3. 1955
  4. 1985
Answer-3

Question-4. ______ was the first company in India to issue convertible zero interest debentures in January 1990

  1. Adani Enterprise
  2. Tata Motors
  3. Reliance Limited
  4. Mahindra and Mahindra
Answer-4

Question-5. __________ was the first company in India to issue convertible zero interest debentures in January 1990

  1. Adani Enterprise
  2. Tata Motors
  3. Mahindra and Mahindra
  4. Reliance Limited
Answer-5

Question-6. ADRs are issued in

  1. China
  2. India
  3. USA
  4. Canada
Answer-6

Question-7. An individual authorized by another person, called the principle to act on the latter's on behalf is known as . . . .

  1. Servant
  2. Subordinate
  3. Assistant
  4. Agent
Answer-7

Question-8. Debentures represent

  1. Permanent capital of the company
  2. Fluctuating capital of the company
  3. Loan capital of the company
  4. Fixed capital of the company
Answer-8

Question-9. Dividend is paid only on ___________

  1. Debentures
  2. Shares
  3. Loans
  4. Bonds
Answer-9

Question-10. Expand GDR

  1. Gross Domestic Receipts
  2. Government Direct Receipts
  3. None of the above
  4. Global Depository Receipts
Answer-10

Question-11. Expand ICICI

  1. International Credit and Investment Corporation of India
  2. Industrial Credit and Investment Corporation of India
  3. None of the above
  4. Indian Credit and Investment Corporation of India
Answer-11

Question-12. Funds raised through loans or borrowings are _____

  1. Owners Equity
  2. None of these
  3. Share Capital
  4. Borrowed funds
Answer-12

Question-13. Funds required for purchasing current assets is an example of

  1. Ploughing back of profits
  2. Working capital requirement
  3. Lease financing
  4. Fixed capital requirement
Answer-13

Question-14. ICICI was established in _________________

  1. 1975
  2. 1965
  3. 1955
  4. 1985
Answer-14

Question-15. If a firm's debt ratio is 45%, this means _____ of the firm's assets are financed by equity financing.

  1. 55%
  2. 45%
  3. Cannot be determined without more information
  4. 50%
Answer-15

Question-16. In which form of Business owners have limited liability is

  1. Partnership
  2. Joint Stock Company
  3. Entrepreneurs
  4. Sole Proprietorship
Answer-16

Question-17. Industrial Finance Corporation of India (IFCI) was established in

  1. July 2001
  2. July1956
  3. July 1991
  4. July 1948
Answer-17

Question-18. Internal sources of capital are those that are

  1. generated through loans from commercial banks
  2. generated through issue of shares
  3. generated within the business
  4. generated through outsiders such as suppliers
Answer-18

Question-19. Investors who want steady income may not prefer ____________

  1. Equity Shares
  2. Debentures
  3. None of the above
  4. Bonds
Answer-19

Question-20. Life insurance corporation was set up in ________

  1. 1975
  2. 1956
  3. 1965
  4. 1985
Answer-20

Question-21. Money obtained by issue of shares is known as _____

  1. Share Capital
  2. Loans
  3. Reserve Funds
  4. Debts
Answer-21

Question-22. Public deposits are the deposits that are raised directly from

  1. The directors
  2. The auditors
  3. The owners
  4. The public
Answer-22

Question-23. Sources of finance can be categorised as _____________

  1. Period Basis
  2. Ownership
  3. All of the above
  4. Source of Generation Basis
Answer-23

Question-24. The ordinary shares of a company are delivered to the depository bank; which in turn issues the depository receipts; known as ____

  1. ADR
  2. None of these
  3. GDR
  4. Commercial banks
Answer-24

Question-25. The term 'redeemable' is used for

  1. Commercial paper
  2. Equity shares
  3. Public deposits
  4. Preference shares
Answer-25

Question-26. Under the lease agreement, the lessee gets the right to

  1. Participate in the management of the organization
  2. Use the asset for a specified period
  3. Sell the assets
  4. Share profits earned by the lessor
Answer-26

Question-27. What are internal sources of capital?

  1. Generated through outsiders such as suppliers.
  2. Generated within the business.
  3. Generated through loans from commercial banks.
  4. Generated through issue of shares.
Answer-27

Question-28. Which of the following factors that are considered to solve the financial problems of business organizations are- i. Cost of Capital Supply ii. Importance and Objectives of capital iii. Different types of benefits

  1. i and iii
  2. ii and iii
  3. i, ii and iii
  4. i and ii
Answer-28

Question-29. Which of the following is a commercial bank?

  1. Canara bank
  2. State Bank of India
  3. All of the above
  4. Punjab National Bank
Answer-29

Question-30. Which of the following is a series of constant cash flows that occur at the end of each period for some fixed number of periods . . . .

  1. Annuity due
  2. Perpetuity
  3. A and C
  4. Ordinary annuity
Answer-30

Question-31. Which of the following ratios are intended to address the firm's financial leverage?

  1. Long-term Solvency Ratios
  2. Asset Management Ratios
  3. Profitability Ratios
  4. Liquidity Ratios
Answer-31

Question-32. Which of the following ratios are particularly interesting to shortterm creditors?

  1. Long-term Solvency Ratios
  2. Profitability Ratios
  3. Market Value Ratios
  4. Liquidity Ratios
Answer-32

Question-33. Which of the following statement is TRUE regarding debt?

  1. Unpaid debt can result in bankruptcy or financial failure.
  2. Debt provides the voting rights to the bondholders.
  3. Corporation's payment of interest on debt is fully taxable.
  4. Debt is an ownership interest in the firm.
Answer-33

Question-34. _____________ was the first company in India to issue convertible zero interest debentures in January 1990

  1. Adani Enterprise
  2. Tata Motors
  3. Reliance Limited
  4. Mahindra and Mahindra
Answer-34

Question-35. ADRs are issued in

  1. China
  2. India
  3. USA
  4. Canada
Answer-35

Question-36. Debentures represent

  1. Permanent capital of the company
  2. Fluctuating capital of the company
  3. Loan capital of the company
  4. Fixed capital of the company
Answer-36

Question-37. Dividend is paid only on ___________

  1. Debentures
  2. Bonds
  3. Shares
  4. Loans
Answer-37

Question-38. Equity shareholders are called

  1. Partners of the company
  2. Executives of the company
  3. Guardian of the company
  4. Owners of the company
Answer-38

Question-39. Expand ICICI

  1. International Credit and Investment Corporation of India
  2. Indian Credit and Investment Corporation of India
  3. Industrial Credit and Investment Corporation of India
  4. None of these
Answer-39

Question-40. Funds raised through loans or borrowings are ________

  1. Owners Equity
  2. None of these
  3. Share Capital
  4. Borrowed funds
Answer-40

Question-41. Funds required for purchasing current assets is an example of

  1. Ploughing back of profits
  2. Working capital requirement
  3. Lease financing
  4. Fixed capital requirement
Answer-41

Question-42. GDRs can be converted into shares _____________

  1. After 5 years
  2. After 10 years
  3. After one year
  4. At any time
Answer-42

Question-43. ICICI was established in _________________

  1. 1955
  2. 1985
  3. 1965
  4. 1975
Answer-43

Question-44. Industrial Finance Corporation of India (IFCI) was established in _______

  1. July, 2001
  2. July, 1956
  3. July,
  4. July, 1948
Answer-44

Question-45. Internal sources of capital are those that are

  1. generated through loans from commercial banks
  2. generated through issue of shares
  3. generated within the business
  4. generated through outsiders such as suppliers
Answer-45

Question-46. Investors who want steady income may not prefer ____________

  1. Debentures
  2. Equity Shares
  3. Bonds
  4. None of these
Answer-46

Question-47. Life insurance corporation was set up in ________

  1. 1956
  2. 1975
  3. 1985
  4. 1965
Answer-47

Question-48. Money obtained by issue of shares is known as ___________

  1. Share Capital
  2. Loans
  3. Reserve Funds
  4. Debts
Answer-48

Question-49. Public deposits are the deposits that are raised directly from

  1. The directors
  2. The auditors
  3. The owners
  4. The public
Answer-49

Question-50. State Industrial Development Corporations were established by _______

  1. None of these
  2. Central Government
  3. Different States
  4. Ministry of Finance
Answer-50

Question-51. The maturity period of a commercial paper usually ranges from

  1. 60 to 90 days
  2. 120 to 365 days
  3. 90 to 364 days
  4. 20 to 40 days
Answer-51

Question-52. The ordinary shares of a company are delivered to the depository bank, which in turn issues the depository receipts, known as _______

  1. ADR
  2. None of these
  3. GDR
  4. Commercial banks
Answer-52

Question-53. The term 'redeemable' is used for

  1. Commercial paper
  2. Equity shares
  3. Public deposits
  4. Preference shares
Answer-53

Question-54. Under the factoring arrangement, the factor

  1. Makes the payment on behalf of the client
  2. Collects the client's debt or account receivables
  3. Transfer the goods from one place to another
  4. Produces and distributes the goods or services
Answer-54

Question-55. Under the lease agreement, the lessee gets the right to

  1. Participate in the management of the organization
  2. Use the asset for a specified period
  3. Sell the assets
  4. Share profits earned by the lessor
Answer-55

Question-56. Unit Trust of India was established by ___________

  1. State Bank Group
  2. Indian Government
  3. HDFC Bank
  4. ICICI
Answer-56

Question-57. When one party grants the other party the right to use the asset in return for a periodic payment, it is known as __________

  1. Factoring
  2. Public Deposits
  3. Debts
  4. Lease Financing
Answer-57

Question-58. Which of the following is a commercial bank?

  1. Canara bank
  2. Punjab National Bank(d) State Bank of India
  3. All of these
Answer-58



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