This quiz works best with JavaScript enabled. Home > Class 12 > Class 12 Business Studies Chapter 9 Financial Management – Quiz 65 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Class 12 Business Studies Chapter 9 Financial Management Quiz 65 (25 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. The Chief Executive Officer approves the company's strategies, goals, and budgets. A) True. B) False. C) All the above. D) None of the above. Show Answer Correct Answer: B) False. 2. Which term describes the money a business earns from selling goods or services? A) Expenses. B) Revenue. C) Assets. D) Liabilities. Show Answer Correct Answer: B) Revenue. 3. Living in New York City is more or less expensive than Lewisburg, PA? A) More. B) Less. C) All the above. D) None of the above. Show Answer Correct Answer: A) More. 4. Agency theory deals with the issue of A) When to hire an agent to represent the firm in negotiations. B) The legal liabilities of a firm if an employee, acting as the firm's agent, injures someone. C) The limitations placed on an employee acting as the firm's agent to obligate or bind the firm. D) The conflicts that can arise between the viewpoints and motivations of a firm's owners and managers. Show Answer Correct Answer: D) The conflicts that can arise between the viewpoints and motivations of a firm's owners and managers. 5. Which of the following is a key component of working capital management? A) Fixed assets. B) Long-term investments. C) Accounts Payable. D) Research and Development. Show Answer Correct Answer: C) Accounts Payable. 6. Investment in Fixed Assets is-of decision- A) Investment. B) Financing. C) Dividend. D) None of these. Show Answer Correct Answer: A) Investment. 7. What is the importance of cash flow management for a new business? A) It has no impact on the success of the business. B) It helps in ensuring the business has enough funds to cover expenses and invest in growth. C) Cash flow management only matters for established businesses. D) It is only important if the business is not planning to grow. Show Answer Correct Answer: B) It helps in ensuring the business has enough funds to cover expenses and invest in growth. 8. Head of finance department A) Finance manager. B) Line manager. C) Top leve manager. D) None of these. Show Answer Correct Answer: A) Finance manager. 9. What is the purpose of conducting a SWOT analysis in financial management? A) To identify internal strengths and weaknesses and external opportunities and threats for strategic planning and risk management. B) To calculate return on investment and profit margins. C) To analyze market trends and consumer behavior. D) To determine employee satisfaction and productivity levels. Show Answer Correct Answer: A) To identify internal strengths and weaknesses and external opportunities and threats for strategic planning and risk management. 10. The capital structure of a company consists of the following securities:Equity share capital of Rs. 10 each Rs. 1, 00, 0008% Debentures RS. 1, 00, 00010% Preference shares Rs. 1, 00, 000The amount of operating profit is Rs. 60, 000. The tax rate applicable to the company is 50%.You are required to calculate the financial leverage of the company A) 1.234. B) 1.524. C) 1.352. D) 1.154. Show Answer Correct Answer: D) 1.154. 11. What does affect the value of company? A) Capital cost. B) Market price of shares. C) Both (a) and (b). D) None of these. Show Answer Correct Answer: C) Both (a) and (b). 12. What is the major advantage corporations have over other business entities? A) It is easier for a corporation to raise capital than other forms of businesses. B) A corporation is treated as a separate legal entity for tax and legal purposes. C) A corporation's shares can be freely traded among its shareholders. D) All of the above are advantages that a corporation has over other business forms. Show Answer Correct Answer: D) All of the above are advantages that a corporation has over other business forms. 13. While designing capital structure a finance manager should choose a pattern of capital which- A) Minimizes cost of capital. B) Maximizes the owners return. C) Maximizes cost of capital and minimizes owners return. D) Both (a) and (b). Show Answer Correct Answer: D) Both (a) and (b). 14. Which of the following is a financing decision? A) Providing for doubtful debts. B) Issuing a 5-year Bond. C) Depreciating a fixed asset. D) None of the above. Show Answer Correct Answer: B) Issuing a 5-year Bond. 15. Which of the following is a Long Term Sources of Finance? A) Bank over Draft. B) Equity Shares. C) Cash Credit. D) Debentures. Show Answer Correct Answer: B) Equity Shares. 16. What is emergency savings? A) Transferring money into your savings before you pay your bills. B) Original amount of money saved or invested. C) Cash set aside to cover the cost of unexpected events. D) Maximizing your return by selling stocks at a higher price than what you paid for. Show Answer Correct Answer: C) Cash set aside to cover the cost of unexpected events. 17. A project has an initial outflow followed by years of inflows. What would be the effect on NPV and the IRR of an increase in the cost of capital?Described to the expected impact from this increase.Item-1. NPV 2. IRR A) Increase, No Change. B) Decrease, No Change. C) No Change, No Change. D) Decrease, Decrease. Show Answer Correct Answer: B) Decrease, No Change. 18. . In capital budgeting, the Internal Rate of Return (IRR) is: A) The discount rate that makes NPV equal to zero. B) The average return over the project's life. C) The minimum required rate of return. D) The maximum possible return. Show Answer Correct Answer: A) The discount rate that makes NPV equal to zero. 19. "Decide the appropriate mix of debt and equity" . This statement is true for A) Investment decision. B) Financing decision. C) Dividend decision. D) Liquidity decision. Show Answer Correct Answer: B) Financing decision. 20. Emergency funds should ideally cover: A) 3-6 months of expenses. B) 1 week of expenses. C) 1 month of expenses. D) 10 years of expenses. Show Answer Correct Answer: A) 3-6 months of expenses. 21. If taxes are ignored, MM approach is identical to A) NI Approach. B) Traditional Approach. C) NOI Approach. D) Non of the above. Show Answer Correct Answer: A) NI Approach. 22. The present value of $ 115, 000 expected to be received one year from today at an interest rate (discount rate) of 10% per year is: A) $ 121, 000. B) $ 100, 500. C) $ 110, 000. D) $ 104, 545. Show Answer Correct Answer: D) $ 104, 545. 23. 'Pasar yang bergerak cepat dan harga yang tepat' pernyataan tersebut merupakan prinsip keuangan 'capital market efficiency'. A) FALSE. B) TRUE. C) All the above. D) None of the above. Show Answer Correct Answer: B) TRUE. 24. Fixed cost per unit ..... A) Does not change with volume of production. B) Be flexible according to the rate of interest. C) Changes according to volume of production. D) Not remains constant. Show Answer Correct Answer: C) Changes according to volume of production. 25. Although it ignores the time value of money, what is the most common method used in practice for capital budgeting? A) Internal rate of return. B) Net present value. C) Payback. D) Accounting rate of return. Show Answer Correct Answer: C) Payback. ← PreviousNext →Related QuizzesClass 12 Business Studies Chapter 9 Financial Management Quiz 1Class 12 Business Studies Chapter 9 Financial Management Quiz 2Class 12 Business Studies Chapter 9 Financial Management Quiz 3Class 12 Business Studies Chapter 9 Financial Management Quiz 4Class 12 Business Studies Chapter 9 Financial Management Quiz 5Class 12 Business Studies Chapter 9 Financial Management Quiz 6Class 12 Business Studies Chapter 9 Financial Management Quiz 7Class 12 Business Studies Chapter 9 Financial Management Quiz 8Class 12 Business Studies Chapter 9 Financial Management Quiz 9Class 12 Business Studies Chapter 9 Financial Management Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books