Financial Management MCQ Questions and Solutions with Explanations | Commerce

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11.
Financial Leverage measures relationship between:

A. EBIT and PBT

B. EBIT and EPS

C. Sales and PBT

D. Sales and EPS

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12.
In case of divisible projects, which of the following can be used to attain maximum NPV?

A. Feasibility Set Approach

B. Internal Rate of Return

C. Profitability Index Approach

D. Any of the above

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13.
Inventory Turnover measures the relationship of inventory with:

A. Average Sales

B. Cost of Goods Sold

C. Total Purchases

D. Total Assets

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14.
Minimum Rate of Return that a firm must earn in order to satisfy its investors, is also known as:

A. Average Return on Investment

B. Weighted Average Cost of Capital

C. Net Profit Ratio

D. Average Cost of borrowing

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15.
Capital Budgeting deals with:

A. Long-term Decisions

B. Short-term Decisions

C. Both A and B

D. Neither A nor B

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16.
Which element of the basic NPV equation is adjusted by the RADR?

A. Denominator

B. Numerator

C. Both A and B

D. None of these

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17.
Which of the following statements is correct?

A. A Higher Receivable Turnover is not desirable

B. Interest Coverage Ratio depends upon Tax Rate

C. Increase in Net Profit Ratio means increase in Sales

D. Lower Debt-Equity Ratio means lower Financial Risk

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18.
The Real Cashflows must be discounted to get the present value at a rate equal to:

A. Money Discount Rate

B. Inflation Rate

C. Real Discount Rate

D. Risk free rate of interest

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19.
If a firm has no debt, which one is correct?

A. OL is one

B. FL is one

C. OL is zero

D. FL is zero

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20.
Financial decision involves:

A. Investment, financing and dividend decision

B. Investment, financing and sales decision

C. Financing, dividend and cash decision

D. None of these

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Financial Management MCQ Questions and Solutions with Explanations | Commerce

11. Financial Leverage measures relationship between:

Answer & Solution

12. In case of divisible projects, which of the following can be used to attain maximum NPV?

Answer & Solution

13. Inventory Turnover measures the relationship of inventory with:

Answer & Solution

14. Minimum Rate of Return that a firm must earn in order to satisfy its investors, is also known as:

Answer & Solution

15. Capital Budgeting deals with:

Answer & Solution

16. Which element of the basic NPV equation is adjusted by the RADR?

Answer & Solution

17. Which of the following statements is correct?

Answer & Solution

18. The Real Cashflows must be discounted to get the present value at a rate equal to:

Answer & Solution

19. If a firm has no debt, which one is correct?

Answer & Solution

20. Financial decision involves:

Answer & Solution

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11.
Financial Leverage measures relationship between:

12.
In case of divisible projects, which of the following can be used to attain maximum NPV?

13.
Inventory Turnover measures the relationship of inventory with:

14.
Minimum Rate of Return that a firm must earn in order to satisfy its investors, is also known as:

15.
Capital Budgeting deals with:

16.
Which element of the basic NPV equation is adjusted by the RADR?

17.
Which of the following statements is correct?

18.
The Real Cashflows must be discounted to get the present value at a rate equal to:

19.
If a firm has no debt, which one is correct?

20.
Financial decision involves: