#2997. Economics

other, level: all
Posted Wed Dec 10 01:39:18 PST 2003 by neha (sadanandneha@yahoo.com).
KV, Hyderabad, India
Concepts Taught: Basics

Unit III

1.Sealed - bid is ___________ method
a) a) Penetration b) Cost-based c) Competition based d) None
Answer (C)
2.Monopoly competition is a market structure where exists
a) a) Two sellers b) One seller c) Two consumers d) Many consumers
Answer (B)
3.Prices are kept high in ___________ method
a) a) Penetration b) Cost-based c) Competition based d) None
Answer (D)
4. Prices are kept low in method
a) a) Penetration b) Cost-based c) Competition based d) Demand based
Answer (A)
5.Maximum limit as to the members in a private company is ________
a) a) 10 b) 20 c) 50 d) unlimited
Answer (C)

6.Minimum number of members required to form a public company
a) a) 2 b) 5 c) 7 d) 10
Answer (C)
7.Maximum number of members in a private company
a) a) 10 b) 20 c) 50 d) 100
Answer (C)
8.Maximum number of members in a partnership firm
a) a) 20 b) 5 c) 7 d) 50
Answer (A)

9.Minimum number of members in a partnership firm
a) a) 2 b) 5 c) 7 d) 10
Answer (A)

10.Minimum number of members required to form a cooperative society is
a) a) 2 b) 5 c) 7 d) 10
Answer (D)


11.Eldest male member and head of Hindu Undivided Family is known as
a) a) Karta b) Chairperson c) Bada d) Guru
Answer (A)

12.A Company is a__________ person.
a) a) Artificial b) Intelligent c) Real d) Great
Answer (A)

13.Members may come, members may go, but a_____________ goes on forever.
a) a) Diamond b) Company c) Partnership d) Sole Proprietorship
Answer (B)

14.Partnership Business has a feature of
a) a) Joint Limited liability b) Liquid liability c) Unlimited Capital d) Joint and Several Liability
Answer (D)

15.Sole proprietorship has a feature of
a) a) Limited liability b) Liquid liability c) Unlimited Capital d) Unlimited Liability
Answer (D)

16.Private company has a feature of
a) a) Limited liability b) Liquid liability c) Public Capital d) Unlimited Liability
Answer (A)

17.Public company has a feature of
a) a) Short-term Capital b) Liquid liability c) Public Capital d) Unlimited Liability
Answer (C)

18.Cooperative society has a feature of
a) a) Limited liability b) Liquid liability c) Public Capital d) Unlimited Liability
Answer (A)

19.Registration is not compulsory in
a) Partnership b) Private Company c) Public Company d) Cooperative Society
Answer (A)

20. High secrecy can be maintained in
a) Partnership b) Private Company c) Public Company d) Sole Proprietorship
Answer (D)
21. Departmental undertaking is
a) Public Enterprise b) Private Enterprise c) Mixed Enterprise d) None

Answer (A)
22. One person is entitiled for profits in
a) Partnership b) Public Company c) Private Company d) Sole Proprietorship
Answer (D)
23. A partnership will be dissolved in case of
a) Partner opening new bussiness b) Partner is becoming insane c) Both d) None
Answer (B)
24. Excessive Government regulations is the disadvantage of
a) Partnership b) Sole Proprietorship c) Company d)None
Answer (C)
25.Nominal partners are
a) Not Liable to third party b) Liable to third party c) Make Capital Contribution d)None
Answer (B)
26. Members are agents of the firm in
a) Publi Company b) Private Company c) Partnership d) None
Answer (C)
27. Any activiy carried out for the purpose of generating profits is called
a) Gambling b) Speculation c) Bussiness d) None

Answer (C)
28. A company which has business in more than one country is a
a) Dynamic Company b) Foreign Company c) Multi National Company d) None
Answer (C)
29. People having same objective coming together and forming an organisation with service motive in
a) Public Company b) Private Company c) Cooperative Society d)None

Answer (C)
30.One person one vote is the principle in
a)Public Company b) Private Company c) Cooperative Society d)None
Answer (C)

Unit IV

1.Expand P.I
a) Profit Interest b) Profitability Index c) Provident Index d) Price Index
Answer (B)
2.P.I is also known as __________ratio
a) a) Cobb-Douglas Ratio b) Benefit to Cost Ratio c) Provident Index Ratio d) Price Index Ratio
Answer (B)
3.Expand N.P.V______________ _________________ _____________
a) a) Net Present Value b) National Profitability Index c) Net Profit Volume d) Net Price Value
Answer (A)
4.Expand A.R.R ______________ __________________ _____________
a) a) Accounting Rise Ratio b) Accounting Rate of Return c) Advanced Rate of Remuneration d) Actual Rate of Return
Answer (B)
5.Working capital is concerned with _________________ assets
a) a) Fictitious b) Long-run c) Short Term d) Long-term
Answer (C)
6.Capital budgeting is concerned with
a) a) Short Term Liability b) Long-term Liability c) Short Term Assets d) Long-term Assets
Answer (D)
7.K = _______________________in capital budgeting
a) a) King b) Cost of Capital c) Profit d) Liability
Answer (B)
8.Formula of P.I _______________.
a) a) Profit/Interest b) PV of Cash Inflows/PV of Cash Outflows c) PV of Cash Outflows/PV of Cash Inflows d) PV of Cash Inflows - PV of Cash Outflows
Answer (B)
9.Formula of N.P.V
a) a) Profit/Interest b) PV of Cash Inflows/PV of Cash Outflows c) PV of Cash Outflows/PV of Cash Inflows d) PV of Cash Inflows - PV of Cash Outflows
Answer (D)
10.A project costs Rs 2,00,000.Annual returns are 50,000 per annum for 6 years. Then pay back period = ?
a) a) 1 year b) 2 years c) 4 years d) 8 years
Answer (C)
11. Formula of Gross Working Capital
a) Current Ratio/Profit b) Current Assets c) Current Assets -- Current Liabilities d) None
Answer (B)
12. Formula of Net Working Capital
a) Current Ratio/Profit b) Current Assets c) Current Assets -- Current Liabilities d) None
Answer (C)
13. Formula of Gross Working Capital
a) Current Ratio/Profit b) Current Assets c) Current Assets -- Current Liabilities d) None
Answer (B)
14.What are the type of shres?
a) Preference and Equity b) Equity and Debt c) Current and Preference d) Redeemable and Current
Answer (A)
14.What are the type of Debentures?
a) Preference and Equity b) Equity and Debt c) Current and Preference d) Non-Convertible and Convertible
Answer (D)
14.What is the return on shares?
a) Interest b) Salary c) Dividend d) Commission
Answer (C)
15.What is the return on Debentures?
a) Interest b) Salary c) Dividend d) Commission
Answer (A)
16.What is the smallest unit/denomination of Capital issued to members?
a) Interest b) Share c) Dividend d) Debt
Answer (B)
17.What is the smallest unit/denomination of Liability issued to public?
a) Interest b) Share c) Dividend d) Debenture
Answer (D)
18.Preference share holders will have preference over others in
a) Voting b) Gambling c) Dividends d) Debt
Answer (C)
19. On which capital a company does'nt have any obligation to pay return?
a) Share Capital b) Debenturs c) Dividends d) Bonds
Answer (A)
20. Where a company is earning good profits, and requires additional capital, the best way to acquire is through
a) Issue of Shares b) Issue of Debentures c) Taking a bank loan d) Selling its assets
Answer (B)
21. Raising Capital from general public is called
a) Subscription b) Public Issue c) Underwriting d) Public Capital
Answer (B)
22. Long term investment of funds is called
a) Deposit b) Investment Issue c) Capital Budgeting d) Public Capital
Answer (C)
23. Expand DCF
a)Debentures Capital Fund b) Disounted Cash Flow c) Debenture Cash Flow d) Dividend Cash Flow
Answer (B)
24. Value printed on share is called
a)Subscription Value b) Issue Value c) Share Value d) Face Value
Answer (D)
25. Dividends are fixed in case of
a) Preference Shares b) Equity Shares c) Current Shares d) Redeemable Shares
Answer (A)
26. Which is a legal obligation
a) Interest Payment b) Dividend Payment c) Working Capital Payment d) None

Answer (A)
27. Plough Back is a ___ source of funds.
a) Internal b) External c) Both d) None

Answer (A)
28. Which is a source of short term credit
a)Trade Credit b) Issue of Debentures c) Issue of Share Capital d) None

Answer (A)
29. Cycle required for estimation of Working Capital
a)Payment Cycle b) Budgeting Cycle c) Working Capital Cycle d) None

Answer (A)
30. Which is a Working Capital
a)Mixed b) Permanent c) Delivery d) None

Answer (B)

Unit V

1.In double Entry Book keeping system, the two aspects of a transaction are
a) a) Debtor and Creditor b) Debit and Credit c) Income and Expenditure d) Asset and Liability
Answer (B)
3.Accounting equation =_______________________.
a) a) Liabilities + Capital = Assets b) Liabilities - Capital = Assets c) Liabilities = Assets + Capital d) None
Answer (A)
4.In which Account all Production/factory expenses are debited.
a) a) Trading A/c b) P&L A/c c) Capital A/c d) Sales A/c
Answer (A)
5.In which Account all Non-Production, Office Expenses are debited.
a) a) Trading A/c b) P&L A/c c) Capital A/c d) Sales A/c
Answer (B)
6. Which is the book of first entry.
a) a) Journal b) Ledger c) Trial Balance d) Balance Sheet
Answer (A)
7.Which is a charge on asset due to general wear and tear.
a) a) Revenue b) Tax c) Discount d) Depreciation
Answer (D)
8.Trading Account reveals __________profit/loss.
a) a) Trading Profit/Loss b) Revenue Profit/Loss c) Gross Profit/ Gross Loss d) Net Profit/Net Loss
Answer (C)
9.Capital appears on ____________side of balance sheet.
a) a) Credit b) Debit c) Liabilities d) Assets
Answer (C)
10.Carriage outwards appears in which account.
a) a) Trading A/c b) P&L A/c c) Capital A/c d) Sales A/c
Answer (B)
11.Where will the amount spent on stationary appear?
Trading A/c b) P&L A/c c) Capital A/c d) Sales A/c
Answer (B)
12.Trade expenses appear in
a) a) Trading A/C b) Balance sheet c) Personal A/C d) None
Answer (D)
13.Opening stock =Rs 30,000, purchases=Rs 40,000,sales=Rs 3,00,000 and closing stock is Rs 30,000.Then gross profit=Rs___________
a) a) 1,00,000 b) 2,00,000 c) 3,00,000 d) 4,00,000
Answer (B)
14.Which of the following does not appear in trading account?
a) a) Carriage inwards b) Returns inwards c) Returns outwards d) Commission
Answer (D)
15.Goodwill is a _________
a) a) Current asset b) Current liability c) Fixed asset d) Liquid asset
Answer (C)

16.Which of the following is not a current asset
a) a) Cash at bank b) Cash in hand c) Rent d) Stock
Answer (C)
17.Which of the following is a current asset
a) a) Discount b) Rent c) Cash at bank d) None
Answer (C)
18.Which of the following is a current liability
a) a) Cash at bank b) Discount c) Creditors d) Rent
Answer (C)
19.Which of the following is a not current liability
a) a) Capital b) Outstanding salaries c) Bills payable d) None
Answer (A)
20.Previous years closing stock is_______________ this year
a) a) Capital b) Opening Stock c) Bills payable d) None
Answer (B)
21.Sales -cost of sales =____________
Gross Profit b) Opening Stock c) Net Profit d) None
Answer (A)

22. _______________ - Selling, administrative, office expenses = NP
Capital b) Opening Stock c) Gross Profit d) Cost
Answer (C)
23.Any amount payable is a____________
a) a) Asset b) Liability c) Bills payable d) Expenditure
Answer (B)
24. Any amount receivable is a________________
a) a) Asset b) Liability c) Income d) Expenditure
Answer (A)

25.Machinary is a ______________
a) a) Short Term Liability b) Long-term Liability c) Short Term Asset d) Long-term Asset
Answer (D)
26.Cash is a__________________ asset
a) a) Fixed b) Liquid c) Permanent d) Long-term
Answer (B)

27.Creditors is a ________________ liability
a) a) Fixed b) Current c) Imaginary d) Long-term
Answer (B)

28.Income received in advance is
a) a) Income b) Liability c) Bills Receivable d) None
Answer (B)
29. Current Ratio =?
a) a) Assets/Liabilities b) Current Assets/Fixed Liabilities c) Current Assets/Current Liabilities d) Quick Assets/ Current Liabilities
Answer (C)

30. Liquid Ratio =?
a) a) Assets/Liabilities b) Current Assets/Fixed Liabilities c) Current Assets/Current Liabilities d) Quick Assets/ Current Liabilities
Answer (D)