This quiz works best with JavaScript enabled. Home > Class 11 > Class 11 Business Studies Chapter 7 Sources Of Business Finance – Quiz 23 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 23 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which source of finance is most suitable for covering sudden shortfalls in cash? A) Overdraft. B) Venture capital. C) Share capital. D) Crowdfunding. Show Answer Correct Answer: A) Overdraft. 2. An advantage to a business of leasing computers rather than buying them outright is that: A) The loan never has to be repaid. B) The computers will never go out of date. C) The total cost of leasing is less than buying the computers. D) It doesn't have to find a large cash sum to buy computers. Show Answer Correct Answer: D) It doesn't have to find a large cash sum to buy computers. 3. Public deposits are raised directly from: A) Financial institutions. B) Shareholders. C) The general public. D) Banks. Show Answer Correct Answer: C) The general public. 4. A business can generate funds internally by ..... A) Accelerating collection of receivables. B) Disposing of surplus inventories. C) Ploughing back its profit. D) All of the above. Show Answer Correct Answer: D) All of the above. 5. Which of the following affects the fixed capital of the business A) Size of the business. B) NAture of the business. C) Both 1 and 2. D) Neither 1 nor. Show Answer Correct Answer: C) Both 1 and 2. 6. Which of the following is an example of internal finance for a limited company? A) Selling shares. B) Selling debentures. C) Obtaining a loan. D) Reducing stock levels. Show Answer Correct Answer: D) Reducing stock levels. 7. Which period of term finance which will. Not exceed more than a year A) Long term. B) Short term. C) Medium term. D) Ultra long term. Show Answer Correct Answer: B) Short term. 8. Which of the following would be the most appropriate source of finance for a new business (which is just launching) that makes mobile phone accessories? A) Retained Profit. B) Sale of Assets. C) Share Capital. D) Friends and family. Show Answer Correct Answer: D) Friends and family. 9. This results when a business' expenses are greater than its income. A) Income. B) Profit. C) Revenuerevenue. D) Loss. Show Answer Correct Answer: D) Loss. 10. GDR cannot be issued in which of the following country? A) Canada. B) India. C) USA. D) China. Show Answer Correct Answer: C) USA. 11. WHAT ARE THE THREE BUSINESS FINANCE? A) A.LONG TERM ASSET SHORT TERM ASET MEDIUM ASSRT. B) B. LONG TERM FINANCE MEDIUM FINANCESHORT TERM. C) C, NON OF THEM. D) None of the above. Show Answer Correct Answer: A) A.LONG TERM ASSET SHORT TERM ASET MEDIUM ASSRT. 12. Which of the following is an example of a cash inflow A) Wages. B) Cash sales. C) Rent. D) Interest paid. Show Answer Correct Answer: B) Cash sales. 13. What is a major limitation of preference shares? A) They provide high returns. B) They dilute equity shareholders' claims. C) They have voting rights. D) They are suitable for high-risk investors. Show Answer Correct Answer: B) They dilute equity shareholders' claims. 14. Is money invested by a business as a result of borrowing. A) Capital. B) Share Capital. C) Loan Capital. D) Asset. E) Non-current Asset. Show Answer Correct Answer: C) Loan Capital. 15. State the advantage of Owners savings A) No interest is paid. B) This makes better use of the capital tied up in the business. C) Permanent source. D) None of the above. Show Answer Correct Answer: A) No interest is paid. 16. A technique uses in comparative analysis of financial statement is A) Graphical analysis. B) Preference analysis. C) Common stock analysis. D) None. Show Answer Correct Answer: C) Common stock analysis. 17. Which is an advantage of share capital? A) Shareholders can demand refunds. B) No dividends must be paid in a poor year. C) It guarantees profit growth. D) It increases founder control. Show Answer Correct Answer: B) No dividends must be paid in a poor year. 18. A break even chart does not show what? A) The margin of safety. B) How much output a business has to produce to break even. C) How much money a business will make at the break even point. D) Costs, revenue and profit at different levels of output. Show Answer Correct Answer: C) How much money a business will make at the break even point. 19. What are the advantages of debt financing? A) Debt financing increases the risk of bankruptcy for businesses. B) Debt financing leads to higher interest rates for businesses. C) Debt financing limits the flexibility of businesses to make financial decisions. D) Debt financing allows businesses to access funds without giving up ownership or control. It provides tax advantages through deductible interest payments and can help build creditworthiness. Show Answer Correct Answer: D) Debt financing allows businesses to access funds without giving up ownership or control. It provides tax advantages through deductible interest payments and can help build creditworthiness. 20. Classify each source of finance as either internal or externalOwners' savings A) Internal. B) External. C) All the above. D) None of the above. Show Answer Correct Answer: A) Internal. 21. Which type of finance is most suitable for a business facing a liquidity crisis but has high-value fixed assets? A) Public deposits. B) Debentures. C) Lease financing. D) Mortgage loans. Show Answer Correct Answer: D) Mortgage loans. 22. The length of a bond A) Coupon Rate. B) Maturity. C) Par Value. D) Yield. Show Answer Correct Answer: B) Maturity. 23. Money needed to function from day to day =??? A) Gross profit. B) Working capital. C) Dividends. D) Working growth. Show Answer Correct Answer: B) Working capital. 24. Trade credit is a medium-term source of funds A) TRUE. B) FALSE. C) All the above. D) None of the above. Show Answer Correct Answer: B) FALSE. 25. Which of the following would be the most appropriate source of funds for a new business (which is just launching) that makes mobile phone accessories? A) Retained Profit. B) Sale of Assets. C) Share Capital. D) Trade Credit. Show Answer Correct Answer: D) Trade Credit. ← PreviousNext →Related QuizzesClass 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 1Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 2Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 3Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 4Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 5Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 6Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 7Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 8Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 9Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books