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Business and Commerce MCQ Questions and Solutions with Explanations | Commerce

Business and Commerce MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Business and Commerce MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-5 section-1

Each section contains 100 MCQs on Business and Commerce .
41
Investment in which of the following is most risky?
Discuss
Answer & Solution
Answer: Option A
Solution:
Investment in Equity shares is most risky. The higher the volatility of a stock, or any asset, the higher its risk. Unit trusts that invest only in equities are higher risk than those that invest in other assets. Their prices move further and the chance of loss is higher.
42
Which of the following is not an ownership security?
Discuss
Answer & Solution
Answer: Option C
Solution:
Debentures is not an ownership security. A debenture is a type of debt instrument that is not secured by collateral and usually has a term greater than 10 years. Debentures are backed only by the creditworthiness and reputation of the issuer. Both corporations and governments frequently issue debentures to raise capital or funds.
43
In which of the following, interest / dividend is payable even if the company does not earn profit?
Discuss
Answer & Solution
Answer: Option C
Solution:
In Debentures, interest / dividend is payable even if the company does not earn profit. No matter what happens – profit or loss, a firm needs to pay interest to its debenture holders/lenders. Only when a company makes a profit, a dividend is distributed.
44
Debentures cannot be ________.
Discuss
Answer & Solution
Answer: Option C
Solution:
Debentures cannot be registered. A debenture is issued to the general public by an organization
45
Ploughing back of profits means __________.
Discuss
Answer & Solution
Answer: Option C
Solution:
The ‘Ploughing Back of Profits’ is a management policy under which all profits are not distributed amongst the shareholders, but a part of the profit is ‘Ploughed back’ or retained in the company.
46
Deferred shares can be issued by ________.
Discuss
Answer & Solution
Answer: Option B
Solution:
According to Companies Act 1956, no public limited company or which is a subsidiary of a public company can issue deferred shares.
47
Which of the following companies may issue share warrants?
Discuss
Answer & Solution
Answer: Option C
Solution:
Public limited companies may issue share warrants. Warrants are sold by companies as a way to raise capital. Although a company could sell stock to raise money, the Securities and Exchange Commission regulates the number of shares a company is allowed to issue. Some companies will issue warrants as a way to sweeten a deal during a takeover or restructuring.
48
A bearer of a share warrant of a company is _____.
Discuss
Answer & Solution
Answer: Option D
Solution:
A bearer of a share warrant of a company is not a member of the company. But if the articles of association of the company provide it, then the bearer is deemed to be the member of the company.
49
Bank overdraft is a good source of finance for _________.
Discuss
Answer & Solution
Answer: Option A
Solution:
Bank overdraft is a good source of finance for Short term. An overdraft facility allows the business to spend more money than is deposited in the bank account. The amount of the overdraft will rise and fall as funds are deposited and spent from the account.
50
The most important economic function of new issue market is to ___________.
Discuss
Answer & Solution
Answer: Option B
Solution:
The most important economic function of new issue market is to provide facilities for converting saving into investments.