Finance MCQs – Page 4

✅ D. Equal to expected return rate

Option A : Mature expected return rate Option B : Lower than expected return rate Option C : Higher than expected return rate Option D : Equal to expected return rate Option E : Correct Answer : Equal to expected return rate Read more

✅ C. Opportunity costs

Option A : Occurred cost Option B : Mean cost Option C : Opportunity costs Option D : Weighted cost Option E : Correct Answer : Opportunity costs Read more

✅ C. Incremental cash flow

Option A : Irrelevant cash flow Option B : Relevant cash flow Option C : Incremental cash flow Option D : Decrease cash flow Option E : Correct Answer : Incremental cash flow Read more

✅ A. Inflation effects

Option A : Inflation effects Option B : Opportunity effects Option C : Equity effects Option D : Debt effects Option E : Correct Answer : Inflation effects Read more

✅ C. Taxation

Option A : Expansion Option B : Salvages Option C : Taxation Option D : Discounts Option E : Correct Answer : Taxation Read more

✅ D. Cost of capital

Option A : Cost of salvage Option B : Cost of interest Option C : Cost of taxation Option D : Cost of capital Option E : Correct Answer : Cost of capital Read more

✅ A. No inflation

Option A : No inflation Option B : High inflation Option C : No transactions Option D : No acceleration Option E : Correct Answer : No inflation Read more

✅ B. Weighted average cost of capital

Option A : Weighted average cost of interest Option B : Weighted average cost of capital Option C : Weighted average salvage value Option D : Mean cost of capital Option E : Correct Answer : Weighted average cost of capital Read more

✅ B. Non cash charge

Option A : Cash charge Option B : Non cash charge Option C : Cash flow discounts Option D : Net salvage discount Option E : Correct Answer : Non cash charge Read more

✅ B. Free cash flow

Option A : Relevant inflows Option B : Free cash flow Option C : Relevant outflows Option D : Cash outlay Option E : Correct Answer : Free cash flow Read more

✅ B. Purchasing power bond

Option A : Borrowed bond Option B : Purchasing power bond Option C : Surplus bond Option D : Deficit bond Option E : Correct Answer : Purchasing power bond Read more

✅ C. Discounted cash flow method

Option A : Market cash flow Option B : Future cash flow method Option C : Discounted cash flow method Option D : Present cash flow method Option E : Correct Answer : Discounted cash flow method Read more

✅ B. Stand-alone risk

Option A : Expected risk Option B : Stand-alone risk Option C : Variable risk Option D : Returning risk Option E : Correct Answer : Stand-alone risk Read more

✅ B. Beta risk

Option A : Expected risk Option B : Beta risk Option C : Industry risk Option D : Returning risk Option E : Correct Answer : Beta risk Read more

✅ B. Relevant cost

Option A : Debt cost Option B : Relevant cost Option C : Borrowing cost Option D : Embedded cost Option E : Correct Answer : Relevant cost Read more

✅ D. Below its par value

Option A : More than its par value Option B : Seasoned par value Option C : At par value Option D : Below its par value Option E : Correct Answer : Below its par value Read more

✅ C. Capital markets

Option A : Liquid markets Option B : Short-term markets Option C : Capital markets Option D : Money markets Option E : Correct Answer : Capital markets Read more

✅ B. Corporate bonds

Option A : Municipal bonds Option B : Corporate bonds Option C : U.S treasury bonds Option D : Mortgages Option E : Correct Answer : Corporate bonds Read more

✅ A. Consumer credit loans

Option A : Consumer credit loans Option B : Commercial markets Option C : Residential markets Option D : Mortgage markets Option E : Correct Answer : Consumer credit loans Read more

✅ D. Cost of equity

Option A : Debt rate Option B : Investment return Option C : Interest rate Option D : Cost of equity Option E : Correct Answer : Cost of equity Read more