Corporate Finance Quizzes

Corporate Finance Quizzes Page-4. The following MCQs are from the theory of Finance, that is Public Finance, Corporate Finance and Personal Finance. View answers to the questions at bottom of the page.

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  1. Net Present Value is calculated as
    1. cash inflow - cash outflow
    2. cash outflow - cash inflow
    3. PV of cash inflow - PV of cash outflow
    4. PV of cash outflow - PV of cash inflow

  2. An investment should be accepted if its NPV is
    1. 0
    2. 1
    3. positive
    4. negative

  3. The ratio between the amount of profit and investment is called the
    1. NPV
    2. opportunity cost
    3. risk premium
    4. rate of return

  4. An investment should be accepted if
    1. Rate of Return > Opportunity Cost
    2. Rate of Return < Opportunity Cost
    3. Rate of Return = Opportunity Cost
    4. A, B and C are irrelevent

  5. Governments and corporations issue bonds to
    1. borrow money
    2. lend money
    3. both A and B
    4. none of these

  6. Regular interest payment to the bond holders is called
    1. principal
    2. coupon
    3. face value
    4. yield

  7. At maturity the bond holders get back their principal. The principal is called
    1. coupon
    2. face value
    3. yield
    4. return

  8. Any economic resource that can produce economic value to the holder is called
    1. asset
    2. return
    3. maturity
    4. yield

  9. A collection of assets held by an investor is called
    1. corporate bond
    2. random returns
    3. risk premium
    4. portfolio

  10. The risk of a well-diversified portfolio depends on the __________ of the securities included in the portfolio.
    1. specific risk
    2. market risk
    3. both A and B
    4. none of these

ANSWERS: CORPORATE FINANCE QUIZZES

  1. C
  2. C
  3. D
  4. A
  5. A
  6. B
  7. B
  8. A
  9. D
  10. B