This quiz works best with JavaScript enabled. Home > Class 11 > Class 11 Business Studies Chapter 7 Sources Of Business Finance – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 4 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. What is an advantage of owner's capital? A) There will be interest. B) You can pay in smaller installments. C) They take a long time to arrange. D) You don't have to pay it back. Show Answer Correct Answer: D) You don't have to pay it back. 2. Which is a short-term source of finance? A) Debentures. B) Share issues. C) Trade credit. D) Long-term loans. Show Answer Correct Answer: C) Trade credit. 3. What are the main short-term sources of finance? A) Bank overdrafts and venture capital. B) Bank loans and creditors from suppliers. C) Debt factoring and trade credit. D) Micro-finance and grants from government agencies. Show Answer Correct Answer: B) Bank loans and creditors from suppliers. 4. What is asset? A) An item of property owned by a person or company. B) An item owned by a business that lasts for several years. C) All the above. D) None of the above. Show Answer Correct Answer: A) An item of property owned by a person or company. 5. The procedure of applying for loan in a financial institution is time consuming and expensive ..... A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: A) True. 6. It is the science that describes the management, creation and study of money, banking, credit, investments assets and liabilities. A) Accounting. B) Economics. C) Finance. D) Management. Show Answer Correct Answer: C) Finance. 7. What are the main responsibilities of banks? A) To receive interest payments as laid down in the loan or overdraft agreement. B) To check on business viability before loan or overdraft is agreed. C) To provide credit encourage the business to purchase stock. D) To attend creditors' meetings if the business is put into liquidation. Show Answer Correct Answer: B) To check on business viability before loan or overdraft is agreed. 8. Short term finance is usually paid back no longer than A) 1 month. B) 6 months. C) 5 years. D) 1 year. Show Answer Correct Answer: D) 1 year. 9. Trade Payable is a suitable source of finance to fund the purchase of what? A) A New delivery vehicle. B) Inventories. C) Property. D) Direct labour. Show Answer Correct Answer: B) Inventories. 10. In which type of business finance are debentures included? A) Long term source. B) Short term source. C) Medium term source. D) None of the above. Show Answer Correct Answer: A) Long term source. 11. What is the role played by the main financial institutions? A) To increase the liabilities or debts of the business. B) To reduce the cost of financing for businesses. C) To provide advice, contacts, and experience to small to medium-sized businesses. D) To manage the day-to-day operations of the business. Show Answer Correct Answer: C) To provide advice, contacts, and experience to small to medium-sized businesses. 12. What happens if you do not pay a credit card bill on time? A) Use your debit card. B) You go into debt. C) Declare bankrupty. D) Pay interest. Show Answer Correct Answer: D) Pay interest. 13. Assertion:Equity share capital act as a permanent source of capital for the businessReason:equity capital is to be repaid at the time of liquidation of a company A) Both assertion (A) and reason(R) are true and reason(R) is the correct explanation of assertion. B) Both Assertion (A) and Reason (R) is not the correct explanation of assertion (A). C) Assertion (A) is true but reason (R) is false. D) Assertion (A) is false but reason (R) is true. Show Answer Correct Answer: A) Both assertion (A) and reason(R) are true and reason(R) is the correct explanation of assertion. 14. What is a source of finance? A) A method of earning incomes. B) The different ways a business can fund themselves. C) All the above. D) None of the above. Show Answer Correct Answer: A) A method of earning incomes. 15. Trade credit is example of A) Long term finance. B) Medium term finance. C) Short term finance. D) All of the above. Show Answer Correct Answer: B) Medium term finance. 16. What is crowdfunding? A) A government grant for large firms only. B) A high-interest loan from banks. C) Raising money from many small investors online. D) Selling shares on the stock market. Show Answer Correct Answer: C) Raising money from many small investors online. 17. Equity Shareholders are called A) Owners of the Company. B) Partners of the Company. C) Executive of the Company. D) Guardian of the Company. Show Answer Correct Answer: A) Owners of the Company. 18. What is the primary reason retained earnings are considered a cost-free source of finance? A) They do not involve any legal compliance. B) They have no explicit cost. C) They do not dilute ownership. D) They are a tax-deductible source. Show Answer Correct Answer: B) They have no explicit cost. 19. Public deposits are the deposits that are raised directly from A) The public. B) The directors. C) The auditors. D) The owners. Show Answer Correct Answer: A) The public. 20. A business can have better control over its cash flow if it: A) Operates an efficient credit control system. B) Keeps up to date records of financial transactions. C) Always plans ahead by producing a cash flow forecast. D) Pays all of its bills on time. Show Answer Correct Answer: D) Pays all of its bills on time. 21. Which is an example of an internal source of finance? A) Owner's Capital. B) Venture Capitalist. C) Overdraft. D) Trade credit. Show Answer Correct Answer: A) Owner's Capital. 22. Buying tables and chairs for a new cafe would be a ..... A) New Business Cost. B) Start Up Cost. C) Running Cost. D) One-Off Cost. Show Answer Correct Answer: B) Start Up Cost. 23. External sources of finance do not include A) Leasing. B) Overdrafts. C) Debentures. D) Retained earnings. Show Answer Correct Answer: D) Retained earnings. 24. Preference shareholders are called: A) Partners of the company. B) Owners of the company. C) Executives of the company. D) Guardians of the company. Show Answer Correct Answer: B) Owners of the company. 25. Which individual in an organization is responsible for analyzing financial data and making recommendations for investment decisions? A) CEO. B) CFO. C) COO. D) CMO. Show Answer Correct Answer: B) CFO. ← 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 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 10Class 11 Business Studies Chapter 7 Sources Of Business Finance Quiz 11 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books