Profit Maximization is the main objective of business because:

Select one:
a. Profit acts as a measure of efficiency
b. It serves as a protection against risk
c. Both- A
d. none
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The present value of an annuity of INR. 3000 for 15 years at 4.5% p.a CI is
Select one:
a. 23,809.41-A
b. 32,214.60
c. 3 2,908.41
d. none of these
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If P = INR. 1,000, R = 5% p.a, n = 4; What is Amount and C.I. is
Select one:
a. INR. 1,215.50, INR. 215.50-A
b. INR. 1,125, INR. 125
c. INR. 2,115, INR. 115
d. none of these
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Debt capital refers to:
Select one:
a. Money raised through the sale of shares
b. Funds raised by borrowing that must be repaid.-A
c. Factoring accounts receivable
d. Inventory loans
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External sources of finance do not include:
Select one:
a. Debentures
b. Retained earnings-A
c. Overdrafts
d. Leasing
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Which of the following is NOT an element of financial management?
Select one:
a. Allocation of resources-A
b. Financial Planning
c. Financial Decision-making
d. Financial control
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Alibaba borrows INR. 6 lakhs Housing Loan at 6% repayable in 20 annual installments
commencing at the end of the first year. How much annual payment is necessary.
Select one:
a. 52,420
b. 52,419
c. 52,310-A
d. 52,320
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To achieve wealth maximization, the finance manager has to take careful decision in
respect of:
Select one:
a. Investment
b. Financing
c. Dividend
d. All the above.-A
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The most important goal of financial management is:
Select one:
a. Profit maximisation
b. Matching income and expenditure
c. Using business assets effectively
d. Wealth maximisation-A
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Management of all matters related to an organisation’s finances is called:
Select one:
a. Cash inflows and outflows
b. Allocation of resources
c. Financial management-A
d. Finance.
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The following statements relate to various functions within a business. 1 The
financial management function makes decisions relating to finance 2 Management
accounts incorporate non-monetary measures. Are the statements true or false?
Select one:
a. Statement 1 is true and statement 2 is false
b. Both statements are true-A
c. Statement 1 is false and statement 2 is true
d. Both statements are false
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Which one of the following statements is incorrect?
Select one:
a. Money markets are markets for long-term capital
b. Money markets are operated by banks and other financial institutions-A
c. Money market instruments include interest-bearing instruments, discount
instruments and derivatives
d. Money market instruments are traded over the counter between institutional
investors
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A government follows an expansionary monetary policy. How would this typically
affect businesses?
Select one:
a. Higher demand from customers, lower interest rates on loans and increased
availability of credit
b. A contraction in demand from customers, higher interest rates and less available
credit
c. Lower taxes, higher demand from customers but less government
subsidies/available contracts
d. Lower interest rates, lower exchange rates and higher tax rates-A
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Which of the following are money market instruments? 1- Certificate of deposit 2-
Corporate bond 3- Commercial paper 4- Treasury bill
Select one:
a. 1, 2 and 4 only
b. 1 and 3 only
c. 1, 3 and 4 only-A
d. 1, 2, 3 and 4
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As the economy booms and approaches the limits of productivity at a point in time,
a manufacturing business would typically feel which one of the following effects?
Select one:
a. Increased inflation (higher sales prices and higher costs), difficulty in
finding suitable candidates to fill roles and higher interest rates-A
b. High export demand, increasing growth rates, high inflation and high interest
rates
c. Reducing inflation, falling demand, reducing investment, increasing unemployment
d. Higher government spending, lower tax rates, high inflation and low unemployment
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A client requires £100,000 one year from now. If the stated annual rate is 2.50%
compounded weekly, the deposit needed today is closest to:
Select one:
a. £97,500.
b. £97,532.-A
c. £97,561.
d. £96,570.
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The value in six years of $75,000 invested today at a stated annual interest rate
of 7% compounded quarterly is closest to:
Select one:
a. $112,555.00-A
b. $113,330.00
c. $113,733.00
d. $100,000
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