Basic Finance MCQs with Answers including introduction and fundamental of finance for banking and business.
Basic Finance MCQs
The intrinsic value of call option is:
A. stock price ⁄ exercise price
B. stock price – exercise price
C. stock price + exercise price
D. stock price x exercise price
The type of voting in which the owner having half voting shares can elect board of directors is called:
A. directors voting
B. half voting
C. straight voting
D. owners voting
According to futures contract, the long position states the:
A. purchase of forward contracts
B. purchase of future contract
C. sale of futures contract
D. sales of forward contracts
The type of liability in which the stockholders losses are counted for only the invested amount in the firm is classified as:
A. counted liability
B. invested liability
C. unlimited liability
D. limited liability
The type of voting in which all the directors in voting lists are voted at same time is classified as:
A. cumulative voting
B. non-cumulative voting
C. dual class voting
D. limited voting
The stock holder who does not have any voting rights in the corporation is considered as:
A. sub class voter
B. preferred stockholder
C. common stock holder
D. cumulative voter
Consider buying the call option, if the price of stock falls then the buyer of call option has:
A. high potential of profit
B. low potential of profit
C. low potential of losses
D. high potential of losses
The process in which the group of investment banks distribute the securities is classified as:
A. task groups
B. syndicate
C. investment groups
D. securitize groups
The type of financial security whose payoff is linked to any other security is called:
A. strong security
B. semi-strong security
C. derivate security
D. non-derivate security
When the earnings are reinvested instead of payments of dividends, then the capital gains:
A. must increases
B. must decreases
C. must be zero
D. must be one
