Diploma in Business Finance /60 0 Your Examination is Complete !You will get your result in your email id within 10 days.kindly also email your 10th Marskheet and Aadhar Card copy at iisdtindia@gmail.com. Diploma in Business Finance 1 / 60An investor invests in assets known as a Securities Block of Assets Portfolio None of the above 2 / 60Internal sources of capital are those that are generated through outsiders such as suppliers generated through loans from commercial banks generated through issue of shares generated within the business 3 / 60What are the basic components of business ethics? Morality Business practice Principles and values. All of the above. 4 / 60The concept of financial management is Profit maximization All features of obtaining and using financial resources for company operations. Organization of funds Effective Management of every company 5 / 60What does financial leverage measure? No change with EBIT and EPS The sensibility of EBIT with % change with respect to output. The sensibility of EPS w.r.t % change in the EBIT level. % variation in the level of production. 6 / 60The finance manager is accountable for. Earning capital assets of the company Effective management of a fund Arrangement of financial resources Proper utilisation of funds 7 / 60What is the primary goal of financial management? To minimise the risk To maximise the owner’s wealth To maximise the return To raise profit 8 / 60Which of the following decisions require the use of a decision-tree approach? It is used for projects with independent cash flows. It is used for making a decision to either accept or reject a proposal. It is used for sequential decisions. None of the above 9 / 60The term 'redeemable' is used for Preference shares Commercial paper Equity shares Public deposits 10 / 60Which of the above factors helps to determine the capital structure of a firm? Government policies Degree of Control Cost of capital All of the above 11 / 60Which is not a component of specific forces of the business environment? Customers Technological conditions Investors Employees 12 / 60If there is an increase in interest rates than the fixed interest rate of the corporate bond will. Return to the corporation Decrease in value Remain unchanged Increase in value 13 / 60The market price of an equity share is determined by: The president of a company. The board of directors. Buyers and sellers of those shares. The stock exchange where those shares are getting traded. 14 / 60Which of the following is not incorporated within the capital budgeting decision for a company? The rate of cash discount Time value of money The required rate of return None of the above 15 / 60What is the major component of business ethics? Ethics Ethical principles Rules of behaviour. All of the above. 16 / 60Investment can be defined as Person’s dedication to purchasing a house or flat Use of capital on assets to receive returns Usage of money on a production process of products and services Net additions made to the nation’s capital stocks 17 / 60Which of the following decisions affects the size of assets, the profitability and competitiveness of a firm? Dividend decision. Working capital decision. Capital Budgeting decision. None of the above. 18 / 60Which one of the following is shown first when the assets are arranged in the order of their liquidity? Investment Cash in hand Debtors None of the above 19 / 60Which of the following is not a profit-making objective of most businesses? Leading product and customer satisfaction Aggressive competitive pricing policy. All of the above. None can be answered. 20 / 60Which of the following is a series of constant cash flows that occur at the end of each period for some fixed number of periods . . . Ordinary annuity Annuity due Perpetuity A and C 21 / 60What is the main reason behind the specific required rates of return for different projects? It does not take into account the cost of capital and timing of return. If a firm is divided then the units will also have a separate rate of return. Both a and b are correct None of the above 22 / 60What is the general concept of business ethics? Ethical principles follow a universal truth. All people involved in business should act in a morally correct way. The way of doing business should be fair and honest. None of the above. 23 / 60Investments would score high only if there is a protection to Real estate Preferred stock Government bonds Common stock 24 / 60To get a broad idea of the risk profile of a business, one should look at their ________ Capital structure Dividend policy Profit and loss statement None of the above 25 / 60How to show the elements of the method of production? Capital Investment Wage labour Entrepreneurial Cooperative. 26 / 60GST is a consumption of goods and service tax based on Development Dividend Duration Destination 27 / 60Which of the following is true for an investment proposal with the most significant relative risk? It will have the lowest opportunity loss. It will have the highest expected net present value. It will have the highest standard deviation of the net present value. It will have the highest coefficient of variation of the net present value. 28 / 60Which of the following is a disadvantage of using the payback period? It does not take into account the cost of capital and timing of return. When compared to the accounting rate of return method, it is more difficult to calculate and understand. It does not take the initial investment into account. All of the above 29 / 60Capital Budgeting decisions are evaluated using the _________ and _______ is used for this purpose. Weighted average, cost of capital Weighted average, component cost Unweighted average, cost of capital None of the above 30 / 60How to show the role of government in business?. Positive Negative Neutral None of the above 31 / 60Investors agree to invest in high- risk investments if only There are any true speculations. The predicted return is satisfactory for taking a risk. There are no safe options except for holding cash. The return is short. 32 / 60.Over the period, investors determine the compound growth rate of an investment by Arithmetic median Arithmetic mean Calculus means Geometric mean 33 / 60Which of the following is true for a project with a shorter payback period? The project will have a lesser risk The project will have less Net Present Value The project will have more Net Present Value The project will have a greater risk 34 / 60Which of the following principles is not considered within capital budgeting for a company? Post-tax principle Accrual principle Cash flows principle None of the above 35 / 60The price at which a bond gets traded at a stock exchange is known as: Maturity Value Market Value Face Value Redemption Value 36 / 60In an organisation, the shareholders’ wealth is represented by: The salary paid to employees The market price of a share The book value of a firm’s assets None of the above 37 / 60Which of the following is not a major component of ethical business practice? Honesty Self-respect Respect for law and public opinion. None can be answered. 38 / 60If a firm’s debt ratio is 45%, this means _____ of the firm’s assets are financed by equity financing. 50% 55% 45% Cannot be determined without more information 39 / 60CAPM stands for. Capital asset pricing model. Capital amount printing model. Capital amount pricing model. Capital asset printing model. 40 / 60Which of the following would be the best example of a capital budgeting decision? Purchasing new machinery to replace an existing one. Transferring money to your creditor’s account. Payment of electricity bill for your factory. Payment of electricity bill for your factory. 41 / 60The process of financing the assets of a business is known as: Asset Structure Owners Structure Financial Structure Capital Structure 42 / 60The ordinary shares of a company are delivered to the depository bank; which in turn issues the depository receipts; known as ____ Commercial banks ADR None of these GDR 43 / 60Under the lease agreement, the lessee gets the right to Share profits earned by the lessor Participate in the management of the organization Use the asset for a specified period Sell the assets 44 / 60Money obtained by issue of shares is known as _____ Debts Share Capital Loans Reserve Funds 45 / 60Industrial Finance Corporation of India (IFCI) was established in ____ July 1948 July 2001 July1956 July 1991 46 / 60The market value of the shares is decided by The investment markets The government Shareholders The respective companies 47 / 60Name the things that help the development of the business? Technological innovation Capital investment Economic growth Trade liberalisation. 48 / 60Which of the following options is a part of the Capital Structure of a company? Short-term borrowings Accounts payable Equity shares None of the above 49 / 60Capital structure ______________ financial structure Is a part of Is not a part of Is the same as Is different from 50 / 60Capital Structure is an optimal mix of which one of the following options: Sales and profits Debt and equity Current assets and fixed assets None of the above 51 / 60What are business ethics? Ethics of the company The ethical theory of the company. Rules and policies. Compromise between ethics and customs. 52 / 60In Capital Market Line every investment is Finitely divisible Infinitely divisible Both a & b None of the above 53 / 60Capital Structure is a part of ___________: The asset side of a balance sheet The liability side of a balance sheet The Trial Balance None of the above 54 / 60From the below-mentioned items which are financial assets? Machines Bonds Stocks B and C 55 / 60What is the goal of business? Maximising profit Maintaining customer satisfaction. Solving customer problems. All of the above 56 / 60Which of the following can be a criterion for the acceptance of a project? The Profitability Index should be greater than unity. The Internal Rate of Return should be greater than the cost of capital. The Net Present Value should be greater than zero. All of the above 57 / 60The capital budget is associated with. Fixed assets Long terms and short terms assets Long terms assets Short term assets 58 / 60Debentures represent Fixed capital of the company Permanent capital of the company Fluctuating capital of the company Loan capital of the company 59 / 60Funds raised through loans or borrowings are _____ Borrowed funds Owners Equity None of these Share Capital 60 / 60ICICI was established in _________________ 1985 1975 1965 1955 Exit
