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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Finance is?

None of the above

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

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!

Finance has its origins in?

Accounting and sociology

Psychology and mathematics

Economics and statistics

Accounting and economics

Correct! Wrong!

Which of the following is a money market instrument?

Stocks

Corporate bonds

Treasury bill

Correct! Wrong!

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

Shareholder; bondholder

Accountant; bondholder

Manager; owner

Shareholder; manager

Correct! Wrong!

Financial decisions are concerned with which of the following?

Making asset management decisions that optimize economic wealth

Raising capital that is needed for growth

Making investment decisions that optimize economic value

All of given options

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?

Financial environment

Operating environment

Regulatory environment

International environment

Correct! Wrong!

The purpose of financial markets is to?

Allocate savings efficiently

Lower the yield on bonds

Increase the price of common stocks

Control inflation

Correct! Wrong!

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

Have healthy cash flow

Maximize market share

Maximize the owners’ wealth

Increase sales and profit

Correct! Wrong!

Which of the following is a depository financial institution?

A pension fund

A finance company

An investment bank

A savings bank

Correct! Wrong!

Financing decision determines?

Mix of finance

Fix asset

Equity

Current asset

Correct! Wrong!

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 secondary market transaction

A money market transaction

A futures market transaction

It is primary market transaction

Correct! Wrong!

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

HR decisions

Marketing decisions

Investing decisions

Promotion decisions

Correct! Wrong!

Which of the following statements always apply to corporations?

Mix of ownership and control

Single taxation

Limited life

Limited liability

Correct! Wrong!

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

Financial management; Operations

Accounting; Financial management

Financial management; Accounting

Operational; Financial management

Correct! Wrong!

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

Primary market

Secondary market

Money market

Capital 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?

Financial Institutions

Financial market organizations

International financial organizations

Federal agencies

Correct! Wrong!

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

The minimization of the amount of taxes paid by the firm

The profits earned by the firm

The creation of value for shareholders

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

Correct! Wrong!

The Financial institutions makes it easier to trade because it?

Channels Funds from Savers to Borrowers

Facilitate Payments

Enables Risk Sharing

All of the given options

Correct! Wrong!

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

Financial management

Social responsibility

Profit maximization

Agency theory

Correct! Wrong!

What are the three interrelated areas of finance?

Financial markets, option and forwards

Investment, Financial management and Financial market & Financial institution

All of given options

Banking, financial institutions and swap currency

Correct! Wrong!

Introduction to Finance

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Introduction to Finance MCQs

Learning Objectives

MCQs 1 to 20

Finance is?

Finance has its origins in?

Which of the following is a money market instrument?

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

Financial decisions are concerned with which of the following?

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

The purpose of financial markets is to?

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

Which of the following is a depository financial institution?

Financing decision determines?

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 the activity in which finance people are involved?

Which of the following statements always apply to corporations?

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

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?

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

The Financial institutions makes it easier to trade because it?

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

What are the three interrelated areas of finance?

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References

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