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Management Questions and Answers for Competitive Exams | MBA BBA Quiz Set 6

1 A firm is currently earning ` 50,000 and its one share has a present market value of ` 175. It has 5,000 shares outstanding. The earnings of the firm is expected to remain stable and it has a payout ratio of 100%. The cost of equity is :
1 10%
2 5.71%
3 100%
4 23.50%

Answer: 5.71%
2 With project cost of ` 300 lacs, profits after depreciation (straight line method) and tax for its lifetime of 5 years are estimated at ` 10 lacs, ` 10 lacs, ` 30 lacs, ` 40 lacs and ` 50 lacs respectively. The cost of capital is 12% and discount factors @ 12%, for the first five years are 0.89, 0.80, 0.71, 0.64 and 0.57 respectively. The Net present value of project is :
1 8.90 lacs
2 140 lacs
3 (−)207.70 lacs
4 308.90 lacs

Answer: 8.90 lacs


3 Which of the following statements are true ? Select the correct code.

(a) WTO rules are mainly applied to trade in goods but other areas such as services, intellectual property, etc., are not covered by them.

(b) GATT had contracting parties, whereas WTO has members.

(c) The dispute settlement system under WTO is much more efficient, speedy and transparent unlike the GATT system which was highly susceptible to blockages.

Code :
1 (a) and (b)
2 (b) and (c)
3 (a), (b) and (c)
4 (a) and (c)

Answer:(b) and (c)
4 Which trade group, among the following holds ‘Tamil’ as one of its official language ?

5 Assertion (A) : The integration of domestic economy through the twin channels of trade and capital flows has accelerated in the past two decades which in turn led the Indian economy growing from ` 32 trillion in 2004 to about ` 153 trillion by 2016.

Reasoning (R) : The Government of India is keen to grow exports and provide more jobs for the young, talented, well-educated and even semi-skilled and unskilled workforce in India.

Code :
1 Both (A) and (R) are correct; and (R) is the right explanation of (A).
2 Both (A) and (R) are correct; but (R) is not the right explanation of (A).
3 (A) is correct but (R) is incorrect.
4 (R) is correct but (A) is incorrect.

Answer:Both (A) and (R) are correct; and (R) is the right explanation of (A).
6 Which of the following is a benchmarking tool to measure performance along the logistics supply chain among countries ?
1 Logistics Preparedness Index
2 Supply Chain Performance Index
3 Logistics Performance Index
4 Supply Chain Preparedness Index

Answer:Logistics Performance Index
7 Which of the following is/are not true about linear shipping ?

(a) It is used for cargo with higher unit value and manufactured or semi-manufactured goods.

(b) Its shipping lines offer slower shipping services.

(c) It operates regularly on a fixed schedule.

(d) Its document of transport contract is called ‘Charter Party’.

Code :
1 (a) and (c)
2 (a), (b) and (d)
3 (d) only
4 (b) and (d)

Answer:(b) and (d)
8 The statements relate to International Financial Environment. Denote the code of the statements being correct or incorrect.

Statement (I) : Foreign exchange risk denotes the variance of domestic currency value of assets, liabilities, or operating income attributable to anticipated changes in exchange rates.

Statement (II) : Foreign exchange exposures denote the sensitivity of the real value of assets, liabilities and operating income to unanticipated changes in exchange rates expressed in its functional currency.

Code :
1 Both the statements are correct.
2 Both the statements are incorrect.
3 Statement (I) is correct while Statement (II) is incorrect.
4 Statement (I) is incorrect while Statement (II) is correct

Answer:Statement (I) is incorrect while Statement (II) is correct.
9 Which among the following firms having foreign trade qualifies for financial assistance under the Market Development Assistance (MDA) Scheme ?
1 Having annual turnover upto ` 10 crore.
2 Having annual turnover upto ` 20 crore.
3 Having annual turnover upto ` 25 crore.
4 Having annual turnover upto ` 30 crore.

Answer:Having annual turnover upto ` 30 crore.
10 Managerial economics is concerned with which combination of the following ?

(a) Investment Analysis and Decisions

(b) Production Behaviour and Cost Analysis

(c) Input Reward Analysis and Decisions

(d) Economic Environment Analysis

Code :
1 (a), (b)and (c)
2 (b), (c) and (d)
3 (a), (b) and (d)
4 (a), (c) and (d)

Answer:(a), (b) and (d)
11 In case the producer’s equilibrium shifts to a higher isoquant due to decrease in price of an input, the curve combining the successive equilibrium positions is known as :
1 Product Possibility Curve
2 Price Factor Curve
3 Expansion Path
4 Product Line

Answer:Price Factor Curve
12 Which one of the following statements is not correct ?
1 Marginal cost declines at a faster rate as compared to the average cost.
2 Marginal cost rises at a faster rate as compared to the average cost.
3 Marginal cost equals average cost where average cost is minimum.
4 Average cost equals marginal cost where marginal cost is minimum.

Answer:Average cost equals marginal cost where marginal cost is minimum.
13 Cost - Plus pricing is not suitable for :
1 Product Tailoring
2 Profit Maximising
3 Monopsony Pricing
4 Public Utility Pricing

Answer:Profit Maximising
14 The achievement of goals with the least amount of resources is : `
1 Effectiveness
2 Efficiency
3 Productivity
4 Both (1) and (2)

15 Which one of the following is the fundamental rethinking and radical redesign of business processes to achieve improvements in performance ?
1 Reengineering
2 Reorganising
3 Revisiting
4 Rescheduling


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