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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-9 section-10

Each section contains 100 MCQs on Financial Management .
81
Document in a corporation which consists of amount of stock, name and addresses of directors is classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Document in a corporation which consists of amount of stock, name and addresses of directors is classified as charter. A charter plane or boat is one which is hired for use by a particular person or group and which is not part of a regular service.
82
A price for equity is called
Discuss
Answer & Solution
Answer: Option B
Solution:
A price for equity is called cost of equity. The cost of equity is the return a company requires to decide if an investment meets capital return requirements.
83
Risk in which value of investment depends on what happens to foreign exchange rates is classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
Risk in which value of investment depends on what happens to foreign exchange rates is classified as exchange rate risk. Exchange rate risk, also known as currency risk, is the financial risk arising from fluctuations in the value of a base currency against a foreign.
84
Members and employees of credit unions are loaned for
Discuss
Answer & Solution
Answer: Option D
Solution:
Members and employees of credit unions are loaned for mortgages, home improvement loans and auto purchases.
85
Ability to trade at net price very quickly is classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
Ability to trade at net price very quickly is classified as liquidity. Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market at a price reflecting its intrinsic value. In other words: the ease of converting it to cash.
86
Bonds which are more risky than corporate bonds and are issued by major corporations are classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Bonds which are more risky than corporate bonds and are issued by major corporations are classified as preferred stocks. Preferred stockholders have a higher claim to dividends or asset distribution than common stockholders.
87
In financial markets, period of maturity within one to five years of financial instruments is classified as
Discuss
Answer & Solution
Answer: Option C
Solution:
In financial markets, period of maturity within one to five years of financial instruments is classified as intermediate term. A term is an intermediate (or innominate) term if the remedy for its breach depends on the effect of the breach at the time it happens.
88
Collection of money from investors and spending money in other investment activities is classified as
Discuss
Answer & Solution
Answer: Option B
Solution:
Collection of money from investors and spending money in other investment activities is classified as hedge funds. A hedge fund is basically a fancy name for an investment partnership. It's the marriage of a professional fund manager, who can often be known as the general partner, and the investors, sometimes known as the limited partners, who pool their money together into the fund.
89
Markets for products such as wheat, rice, cotton, real estate and autos dealing is classified as
Discuss
Answer & Solution
Answer: Option A
Solution:
Markets for products such as wheat, rice, cotton, real estate and autos dealing is classified as physical asset markets. Physical asset markets are for physical products such as wheat, autos, real estate, computers, and machinery.
90
Price of stock that companies observe in financial markets is called
Discuss
Answer & Solution
Answer: Option A
Solution:
Price of stock that companies observe in financial markets is called market price. The market price for goods and services is the current price it can be bought or sold for.