Basic Finance MCQs

Which of the following refers to the difference between the sale price and cost of inventory:

A. Net loss
B. Net worth
C. Markup
D. Markdown

In case of international business which of the given factor(s) must be considered:

A. Role of foreign exchange
B. Balance of payments
C. Attitude of Governments
D. All of the given options

If you have Rs. 850 and you plan to save it for 4 years with an interest rate of 10%, what will be the future value of your savings:

A. Rs. 1,000
B. Rs. 1,244
C. Rs. 1,331
D. Rs. 1,464

Which of the following measure reveals how much profit a company generates with the money shareholders have invested:

A. Profit Margin
B. Return on Assets
C. Return on Equity
D. Debt-Equity Ratio

Which of the following ratios is NOT from the set of Asset Management Ratios:

A. Inventory Turnover Ratio
B. Receivable Turnover
C. Capital Intensity Ratio
D. Return on Assets

A firm has paid out Rs. 150,000 as dividends from its net income of Rs. 250,000. What is the retention ratio for the firm:

A. 12%
B. 25%
C. 40%
D. 60%

The most important item that can be extracted from financial statements is the actual ____ of the firm:

A. Net Working Capital
B. Cash Flow
C. Net Present Value
D. None of the given options

When the market’s required rate of return for a particular bond is much less than its coupon rate, the bond is selling at:

A. Premium
B. Discount
C. Par
D. Cannot be determined

Mr. Y and Mr. Z are planning to share their capital to run a business. They are going to employ which of the following type of business:

A. Sole-proprietorship
B. Partnership
C. Corporation
D. None of the given options

Which of the following ratios are particularly interesting to short term creditors:

A. Liquidity Ratios
B. Long-term Solvency Ratios
C. Profitability Ratios
D. Market Value Ratios

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