ExamVeda
Login
Home

Financial Management MCQ Questions and Solutions with Explanations | Commerce

Financial Management 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. Financial Management 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-4 section-9

Each section contains 100 MCQs on Financial Management .
31
Current price is Rs 40 and dividend paid is Rs 10 then dividend yield will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Dividend yield = Dividend paid / Current price * 100
= 10 / 40 * 100 = 25%
32
Capital gains yield is multiplied for beginning price to calculate
Discuss
Answer & Solution
Answer: Option A
Solution:
Capital gains yield is multiplied for beginning price to calculate capital gain. Capital gain is a rise in the value of a capital asset (investment or real estate) that gives it a higher worth than the purchase price. The gain is not realized until the asset is sold.
33
Constant growth rate is 9.5% and an expected rate of return is 13.5% then expected dividend yield would be
Discuss
Answer & Solution
Answer: Option C
Solution:
Expected dividend yield = Expected rate of return - Constant growth rate
= 13 5% - 9.5% = 4.00%
34
Paid dividend is Rs 20 and current price is Rs 50 then dividend yield will be
Discuss
Answer & Solution
Answer: Option A
Solution:
Dividend yield = Dividend paid / Current price * 100
= 20 / 50 * 100 = 40.00%
35
Stock in small companies, owned by few people but not actively traded is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Stock in small companies, owned by few people but not actively traded is classified as closely held stock. A closely-held stock is a circumstance wherein a company's common shares are predominantly owned by one individual owner or by a small group of controlling stockholders.
36
Type of stock which have characteristics of bonds and common stock is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Type of stock which have characteristics of bonds and common stock is classified as preferred stock. Preferred stock refers to a class of ownership that has a higher claim on assets and earnings than common stock has.
37
Process in which stockholders transfer right to vote to any other person is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Process in which stockholders transfer right to vote to any other person is classified as proxy. A proxy is an agent legally authorized to act on behalf of another party or a format that allows an investor to vote without being physically present at the meeting.
38
Right of common stockholders to purchase additional stock issued by company is classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
Right of common stockholders to purchase additional stock issued by company is classified as pre-emptive right. A preemptive right offers select shareholders of a corporation the right to buy a proportional interest in any future issue of the company's common stock.
39
Type of stock in which dividends are tied to any particular part of a firm is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Type of stock in which dividends are tied to any particular part of a firm is classified as tracking stock. A tracking stock is an equity issued by a parent company that tracks the financial performance of a particular division. Tracking stocks trade in the open market separately from the parent company's stock. Gains or losses in the tracking stock price are based only on the division's performance
40
Rate of return which considers riskiness and an available returns on investments is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Rate of return which considers riskiness and an available returns on investments is classified as minimum acceptable rate of return. A minimum acceptable rate of return (MARR) is the minimum profit an investor expects to make from an investment, taking into account the risks of the investment and the opportunity cost of undertaking it instead of other investments.