MCQ on Nature and Scope of Financial Management: Check the below Financial and Strategic Management MCQ on Nature and Scope of Financial Management with Answers Pdf free download. Financial and Strategic Management MCQ on Nature and Scope of Financial Management Questions for Financial and Strategic Management with Answers were prepared based on the latest exam pattern. We have provided Financial and Strategic Management MCQ on Nature and Scope of Financial Management with Answers to help students understand the concept very well. Students should practice CS Executive MCQ on Nature and Scope of Financial Management Questions with Answers based on the latest syllabus.

MCQ on Nature and Scope of Financial Management

1. To increase a given present value, the discount rate should be adjusted –
(A) Upward
(B) Downward
(C) Keep as it is
(D) None of the above

2. The market price of a share of common stock is determined by:
(A) The board of directors of the firm
(B) The stock exchange on which the stock is listed
(C) The president of the company
(D) Individuals buying and selling the stock

3. The long-run objective of financial management is to _______.
(A) Maximize earnings per share
(B) Maximize the value of the firm’s common stock
(C) Maximize return on investment
(D) Maximize market share

4. The focal point of financial management in a firm is ____.
(A) The number and types of products or services provided by the firm
(B) The minimization of the amount of taxes paid by the firm
(C) The creation of value for shareholders
(D) The profits earned by the firm

5. ______ is the lifeblood of a business.
(A) Finance Manager
(B) Finance
(C) Financial Management
(D) Corporate Financial Management

6. Financial Management is concerned with _______.
(A) Investment Decisions
(B) Finance Decisions
(C) Dividend Decisions
(D) All of the above

7. “Shareholder wealth” in a firm is represented by _____.
(A) The number of people employed in the firm
(B) The book value of the firm’s assets less the book value of its liabilities
(C) The amount of salary paid to its employees
(D) The market price per share of the firm’s common stock

8. The decision function of financial management can be broken down into decisions.
(A) Financing and investment
(B) Investment, financing & asset management
(C) Financing and dividend
(D) Capital budgeting, cash management & credit management

9. A business organization can obtain funds from –
(A) Issue of preference or equity share capital
(B) Issue of debentures
(C) Loan from banks and financial institution
(D) All of the above

10. The funds raised by the issue of ____ are the best from the risk point of view for the company.
(A) equity shares
(B) debentures
(C) both (A) & (B)
(D) none of the above

11. A 30-year bond issued by Reliance Ltd. in 2007 would now trade in the –
(A) Primary money market
(B) Secondary money market
(C) Primary capital market
(D) Secondary capital market

12. Which of the following is not a function of a finance manager?
(A) Investor relations
(B) Credit & collections
(C) Investments
(D) Appointment of financial personnel

13. Money market mutual funds –
(A) Are also known as finance companies
(B) Enable individuals and small businesses to invest indirectly in money-market instruments
(C) Are available only to high net-worth individuals
(D) Are involved in acquiring and placing mortgages

14. The purpose of financial markets is to:
(A) Increase the price of common stocks
(B) Lower the yield on bonds
(C) Allocate savings efficiently
(D) Control inflation

15. Investment decisions are concerned with –
(A) Efficient allocation of funds to specific assets
(B) Determining the proper amount of funds to be employed in the firm.
(C) Determining the composition of liabilities
(D) Short-run projects

16. ______ ensures that the firm utilizes its available resources most efficiently under conditions of competitive markets.
(A) Wealth Maximization
(B) Profit Maximization
(C) Value Maximization
(D) Relation Maximization

17. _____ consistent with the object of maximizing the owner’s economic welfare.
(A) Profit Maximization
(B) Wealth Maximization
(C) Relation Maximization
(D) All of the above

18. Under inflationary conditions, the value of money expressed in terms of its purchasing power over goods and services ______.
(A) Incline
(B) Declines
(C) Increases
(D) Remains constant

19. _____ is a condition where a company cannot meet or has difficulty paying off, its financial obligations to its creditors, typically due to high fixed costs, illiquid assets, or revenues sensitive to economic downturns.
(A) Financial risk
(B) Financial uncertainty
(C) Financial certainty
(D) Financial distress

20. ______ means the organization can no longer meet its financial obligations with its lender or lenders as debts become due.
(A) Financial certainty
(B) Financial insolvency
(C) Financial risk
(D) Identified risk

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