1.Left side of the balance sheet shows......................... Single choice.

(1 Point)

Use and sources of the funds statement

use of the funds

Net assets

sources of the funds

2.Head of Management team is called......................... Single choice.

(1 Point)

CEO

CMO

CFO

Chairman BOD

3.Internal equity is .................................... Single choice.

(1 Point)

Equity figure on the right side of the balance sheet

Part of earning which is retained.

Shares issued by BOD

Shares issued by management

4.Management of the current assets is responsibility of. Single choice.

(1 Point)

Chief Operating Officer

CMO

CFO

CEO

5.Which of the following the two sources are of maximization of shareholder wealth?. Single choice.

(1 Point)

capital gain, capital loss

Capital gain, Dividend

Dividend, Retained Earning

Capital gain, Retained earning

6.In diversification risk...............................and return.............................. Single choice.

(1 Point)

Decreases, is at least not compromised

increases, decreases

Decreases, Increases

Increases,Increase

7.The primary goal of the corporation is ............................. Single choice.

(1 Point)

sales maximization

Shareholder's wealth maximization

Profit maximization

Earning Maximization

8.Corporate governance operates same as ...................... Single choice.

(1 Point)

dictatorship

commerce

Kingdom

democracy

9.Number of shares outstanding is......................................... Single choice.

(1 Point)

Number of shares issued minus treasury stock

Number of shares issued plus treasury stock

Number of shares issued multiplied by treasury stock

Number of shares issued divided by treasury stock

10.In vertical textiles company which makes garment from yarn which of the following is an example of work in process.............. Single choice.

(1 Point)

Garments waste

Finished fabric

Garments

Yarn

11.The return earned by equity holder has which of the following features:. Single choice.

(1 Point)

Amount and timing of the return is fixed.

Amount of the return is fixed but timing is not fixed.

Amount and timing of the return is not fixed.

Timing of the return is fixed but amount is not fixed.

12.Which one of the following is the most important variable in financial statements.. Single choice.

(1 Point)

sales

cost

Depreciation

Profit

13.Market ........................................the transaction cost. Single choice.

(1 Point)

depending on other variable sometimes increases and sometimes decreases

Decreases

has no effect on

increases

14.By pooling many small deposits, financial intermediaries are able to make much larger advances than would be possible for most individuals. This process is called.................................. Single choice.

(1 Point)

Maturity transformation

Intermediation

Aggregation

risk reduction

15.Market makers are ................................. Single choice.

(1 Point)

Dealers

Brokers

sometimes broker sometimes dealer

16.The tight credit policy decreases the return of the corporation. It shows the phenomenon of................ Single choice.

(1 Point)

Low risk High return

Credit policy should be lenient

low risk low return

High risk low return

17.Entrepreneurial market is ................................and ........................is price in this market. Single choice.

(1 Point)

Factor market, profit

Financial market, rent

Financial market, wage

Factor market, rent

18.Currency note is an example of............................. Single choice.

(1 Point)

Intangible assets

tangible assets

real assets

Financial assets

19.Rather than bank, there is a concept of ........................................in Pakistan. Single choice.

(1 Point)

Credit union

Investment Banks

Banking holding companies

Mutual Funds

20.Most borrowers wish to borrow in the .................. whilst most savers are unwilling to lock up their money for the ................. Single choice.

(1 Point)

Short term, long term

Long term, long term

Long term, short term

Short term, short term

21...............are claims on................... Single choice.

(1 Point)

Fixed assets, current assets

Financial assets, real assets

current assets, fixed assets

Real assets , financial assets

22.Which of the following is most liquid asset?. Single choice.

(1 Point)

Inventory

10 Marla house in PCSIR society

Plant

Accounts irretrievable

23.Option is the ........................ Single choice.

(1 Point)

commitment

responsibility

obligation

right

24.Rate of return has......................relation with buying price and .............................relation with selling price of asset or commodity.. Single choice.

(1 Point)

Negative, positive

Positive, negative

Negative, negative

Positive, positive

25.Finance people are more concerned about........................and..................................figures.. Single choice.

(1 Point)

Cashflow, before tax

Cashflow, After tax

Profit, before tax

Profit, After tax

26.Bondholders are...................................and serve as...................................in bond markets.. Single choice.

(1 Point)

Deficit economic units, Borrowers

Deficit economic units, lenders

Surplus economic units, lenders

Surplus economic units, Borrowers

27.Preferred stock is a/an.....................and has................................................ Single choice.

(1 Point)

debt security, preference to common stockholders in claim both assets & earning

hybrid security, preference to common stockholders in claim on assets

Equity security, preference to common stockholders in claim on earnings

hybrid security, preference to common stockholders in claim on both assets & earning

28.Tight credit policy results in....................... Single choice.

(1 Point)

Low level of accounts receivables and bad debts

Low level of accounts receivables

High level of accounts receivables

Low level of accounts payable

29.Which of the following agency problem mitigating tool creates delays in decision making........................ Single choice.

(1 Point)

Stock options

Almost zero decision making at lower and middle level of Management

Different approval autority at different levels

Physical monitoring

30.Balanced economic units are the participants in ........................................ Single choice.

(1 Point)

Factor market

Forex market

Financial market

none of market

31.High risk aversion means........................ Single choice.

(1 Point)

the person will not invest in saving account

will demand higher risk premium for assuming high risk

the person will not invest in risky assets

the person will not invest in common stock

32.Eurobond are ............................... Single choice.

(1 Point)

Issued in Europe only

are the bonds issued in the currency which is the domestic currency

issued in Uk only

are the bonds issued in the currency which is different from the currency of the country where they are issued

33.Transactions in secondary market affect the financial position of .............................. in the market.. Single choice.

(1 Point)

Both buyer and seller

seller

issuer

buyer

34.The expenditure meant for the satisfaction of needs and wants is called........................ Single choice.

(1 Point)

capital good

saving

consumer good

consumption

35.The end product of accounting department is .......................................... Single choice.

(1 Point)

Financial Statements

Trial Balance

Closing entries

Ledger

36.Mutual funds always invests in equity market.. Single choice.

(1 Point)

True

False

37.Maturity matching principle refers to............................................. Single choice.

(1 Point)

Fixed assets should be financed through short term liabilities

revenues and expenses should be matched

Current assets should be financed through short term liabilities

Current assets should be financed through long term liabilities

38.The measure used for calculation of risk is ......................... Single choice.

(1 Point)

Variance

average return

Arithmetic mean

expected return

39.Which of the following has higher level of risk tolerance?. Single choice.

(1 Point)

A very rich young man

Poor man

Old man

An old lady

40.A blue chip company is one.............................and issues................................... Single choice.

(1 Point)

with very low default risk, commercial paper

with very high default risk, commercial paper

with very low default risk, Certificate of Deposit

with very moderate default risk, commercial paper