Introduction to Finance MCQs

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Learning Objectives

After practice this MCQs set, you should be able to:

MCQs 1 to 20

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If an investor were to sell 100 shares of Microsoft stock to another investor in the securities market, this would be referred to as what type of transaction?

A futures market transaction

It is primary market transaction

A money market transaction

A secondary market transaction

Correct! Wrong!

Which of the following is a money market instrument?

Treasury bill

Stocks

Corporate bonds

Correct! Wrong!

Which of the following is a depository financial institution?

An investment bank

A savings bank

A pension fund

A finance company

Correct! Wrong!

What should be the long term focal point of financial management in a firm?

The profits earned by the firm

The minimization of the amount of taxes paid by the firm

The creation of value for shareholders

The number and types of products or services provided by the firm

Correct! Wrong!

Finance has its origins in?

Accounting and sociology

Psychology and mathematics

Economics and statistics

Accounting and economics

Correct! Wrong!

__________ is concerned with the acquisition, financing, and management of assets with some overall goal in mind?

Agency theory

Profit maximization

Financial management

Social responsibility

Correct! Wrong!

Finance is?

The study of how governments and businesses acquire, spend, and manage money and other financial assets

None of the above

The study of how individuals, institutions, governments, and businesses acquire, spend, and manage money and other financial assets

The study of how businesses acquire, spend, and manage money and other financial assets

Correct! Wrong!

Which of the following statements always apply to corporations?

Limited life

Mix of ownership and control

Limited liability

Single taxation

Correct! Wrong!

Financial decisions are concerned with which of the following?

All of given options

Making asset management decisions that optimize economic wealth

Raising capital that is needed for growth

Making investment decisions that optimize economic value

Correct! Wrong!

The purpose of financial markets is to?

Increase the price of common stocks

Control inflation

Lower the yield on bonds

Allocate savings efficiently

Correct! Wrong!

The primary goal of the financial manager of a profit-seeking organization is to?

Have healthy cash flow

Maximize market share

Increase sales and profit

Maximize the owners’ wealth

Correct! Wrong!

What are the three interrelated areas of finance?

Investment, Financial management and Financial market & Financial institution

Banking, financial institutions and swap currency

Financial markets, option and forwards

All of given options

Correct! Wrong!

The controller’s responsibilities are primarily in nature, while the treasurer's responsibilities are primarily related to?

Operational; Financial management

Financial management; Accounting

Accounting; Financial management

Financial management; Operations

Correct! Wrong!

The Financial institutions makes it easier to trade because it?

Enables Risk Sharing

Facilitate Payments

Channels Funds from Savers to Borrowers

All of the given options

Correct! Wrong!

Financing decision determines?

Mix of finance

Fix asset

Current asset

Equity

Correct! Wrong!

The ______________ is a term used to describe the financial system, institutions, markets, businesses, individuals, and global interactions that help the economy operate efficiently?

International environment

Operating environment

Regulatory environment

Financial environment

Correct! Wrong!

Among the pairs given below select a (n) example of a principal and a (n) example of an agent respectively?

Manager; owner

Accountant; bondholder

Shareholder; manager

Shareholder; bondholder

Correct! Wrong!

In finance, we refer to the market where new securities are bought and sold for the first time?

Capital market

Primary market

Secondary market

Money market

Correct! Wrong!

___________________ are intermediaries, such as banks, insurance companies, and investment companies that engage in financial activities to aid the flow of funds from savers to borrowers or investors?

Federal agencies

International financial organizations

Financial Institutions

Financial market organizations

Correct! Wrong!

Which of the following is the activity in which finance people are involved?

Promotion decisions

HR decisions

Investing decisions

Marketing decisions

Correct! Wrong!

Introduction to Finance

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Introduction to Finance MCQs

Learning Objectives

MCQs 1 to 20

If an investor were to sell 100 shares of Microsoft stock to another investor in the securities market, this would be referred to as what type of transaction?

Which of the following is a money market instrument?

Which of the following is a depository financial institution?

What should be the long term focal point of financial management in a firm?

Finance has its origins in?

__________ is concerned with the acquisition, financing, and management of assets with some overall goal in mind?

Finance is?

Which of the following statements always apply to corporations?

Financial decisions are concerned with which of the following?

The purpose of financial markets is to?

The primary goal of the financial manager of a profit-seeking organization is to?

What are the three interrelated areas of finance?

The controller’s responsibilities are primarily in nature, while the treasurer's responsibilities are primarily related to?

The Financial institutions makes it easier to trade because it?

Financing decision determines?

The ______________ is a term used to describe the financial system, institutions, markets, businesses, individuals, and global interactions that help the economy operate efficiently?

Among the pairs given below select a (n) example of a principal and a (n) example of an agent respectively?

In finance, we refer to the market where new securities are bought and sold for the first time?

___________________ are intermediaries, such as banks, insurance companies, and investment companies that engage in financial activities to aid the flow of funds from savers to borrowers or investors?

Which of the following is the activity in which finance people are involved?

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