GAT Subject Test (Management Sciences)

National Testing Service Pakistan

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What are the factors related to the risk structure of interest rates?
asked 3 days ago in GAT Subject Test (Management Sciences) by Financial Management

Anna IQ APTITUDE & ABILITY   -   Verbal Reasoning

Many find it strange that her writing is thought to be tortuous; her recent essays, although longer than most of her earlier essays, are extremely_______.

Anmol Qamar

It is tedious right option?

Anna IQ APTITUDE & ABILITY   -   Verbal Reasoning

The author presents the life of Zane Grey with _____ unusual in a biographer: he is not even convinced that Grey was a good writer.

Fani Warraich

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Bashir Farooqi IQ APTITUDE & ABILITY   -   Verbal Reasoning

During their operational lifetimes, the majority of spacecraft currently face minimal risk of collision with space junk, but given the number of new satellites launched each year, the orbital environment is likely to be less ________ in the future.

Bashir Farooqi IQ APTITUDE & ABILITY   -   Verbal Reasoning

Florence Nightingale was ___ in the development of modern medicine, ___ such practices as sanitization of hospital wards and isolation of actively infected patients.

Florence Nightingale was a pioneer in the development of modern medicine. She was an innovator who initiated such practices as sanitization of hospital wards and isolation of actively infected patients. She was not a collaborator who rejected these practices, nor was she a maverick who protested them. She was an individual who saw the need for these practices and worked to implement them. The other choices are incorrect. A collaborator is someone who works with others. Nightingale did not work with others to reject these practices. A maverick is someone who goes against the established order. Nightingale did not go against the established order by protesting these practices. A pioneer is someone who is the first to do something. Nightingale was not the first person to suggest these practices, but she was the first person to successfully implement them. An individualist is someone who does things their own way. Nightingale did not do things her own way by standardizing these practices. She worked with others to standardize them.
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Linda Greenhouse's articles for the New York Times are an outstanding example of ___, capsulizing prose into a necessarily limited space.

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Roberto Clement was seen as ___ during his life because of both his selflessness on the baseball field and his humanitarian work in his native Nicaragua

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

His habit of spending more than he earned left him in a state of perpetual------ but he------------hoping to see a more affluent day

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Known for his commitment to numerous worthy causes, the philanthropist deserved------ for his-----------

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

You should --------this paragraph in order to make your essay more-----

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

A------glance pays-----attention to details

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Surprisingly enough, it is more difficult to write about the--------than about the---and strange.

The sentence is comparing the difficulty of writing about two different things. The first part of the sentence sets up the contrast by stating that it is more difficult to write about something "surprisingly enough" than something else. The key to understanding the correct answer is to recognize the contrast between the two words in each pair. "Commonplace" refers to things that are ordinary, everyday, or familiar. These are things that are not particularly interesting or unusual. "Exotic" refers to things that are foreign, unusual, or unique. These are things that are out of the ordinary and intriguing because of their distinctiveness. Given this contrast, it makes sense that it would be more difficult to write about something commonplace (which lacks inherent interest or novelty) compared to something exotic (which has a built-in level of intrigue and uniqueness). Therefore, option C is the correct answer because it correctly captures this contrast in difficulty.
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

A-----response is one that is made with----------.

In this sentence, a "speedy" response is described as one made with "alacrity," which means briskness, eagerness, or willingness to respond quickly and with enthusiasm. This choice of words creates a logical and coherent sentence.
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

3. A----is a-------.

In this sentence, a "norm" is described as a "standard." This pairing of words makes sense and creates a coherent sentence. Norms often refer to accepted standards or behaviors within a group or society.
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

It is widely believed that a nuclear war could ____ enough smoke and dust to block out the sun and freeze the earth.

In this context, "billow" means to produce large quantities of smoke and dust, which could have the described catastrophic effects on the environment.
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Consumption of red meat has ____ because its fat content has become a worrisome and ____ matter.

In this context, "declined" fits with the idea that people are eating less red meat, and "controversial" suggests that there is debate or disagreement about its health implications, particularly related to its fat content
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

It takes ____ character to ____ the extremities of the arctic region.

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Consumers refused to buy meat products from the company because of rumors that the water supply at the meat processing plant was ______; the rumors, however, were quite ______, with no hard evidence to back them up.

This choice of words creates a coherent sentence where "contaminated" refers to the rumors about the water supply being polluted, and "unsubstantiated" means that there was no concrete evidence to support these rumors
Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Many kinds of harmful viruses are unhindered when passing through different parts of the host organism; indeed, there are few organic substances which such viruses’ cannot______.

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Their conversation was unsettling, for the gravity of their topic contrasted so oddly with the ______ of their tone

Muhammad Tayyab Ikhlas IQ APTITUDE & ABILITY   -   Verbal Reasoning

Throughout the animal kingdom, ____ bigger than the elephant.

Fani Warraich IQ APTITUDE & ABILITY   -   Verbal Reasoning

Although its publicity has been ___, the film itself is intelligent, well-acted, handsomely produced and altogether ___

Fani Warraich IQ APTITUDE & ABILITY   -   Verbal Reasoning

The Inuit natives of Alaska's North Slope worry that ___ oil exploration might ___their sensitive natural environment.

Fani Warraich IQ APTITUDE & ABILITY   -   Verbal Reasoning

Ants live in colonies based on ___; each member contributes to the good of all by actively working with others in performing necessary tasks.

Sidis IQ APTITUDE & ABILITY   -   Verbal Reasoning

In the given sentence, identify the gerund phrase: "Running marathons in extreme weather conditions requires immense determination and endurance."

A gerund phrase is a phrase consisting of a gerund (a verb form ending in "-ing") and any modifiers or complements. In this sentence, "Running marathons" functions as a gerund phrase because "running" is a gerund acting as the subject of the sentence.
Sidis IQ APTITUDE & ABILITY   -   Verbal Reasoning

Identify the logical fallacy in the following argument: "I've never seen a black swan; therefore, black swans do not exist."

The argument makes a broad generalization based on insufficient evidence. Seeing no black swans personally does not necessarily mean that they do not exist; it's just an insufficient sample size to draw such a conclusion.
Sidis IQ APTITUDE & ABILITY   -   Verbal Reasoning

Choose the word that best completes the analogy: Adorn: Decorate :: _______ : Amass

"Adorn" is a synonym for "decorate." Similarly, "Hoard" is a synonym for "amass" or collect in large quantities.
Sidis IQ APTITUDE & ABILITY   -   Verbal Reasoning

Identify the figure of speech used in the following sentence :"The stars danced playfully in the sky."

Personification is the attribution of human characteristics to non-human entities. In this sentence, the stars are described as "dancing playfully," which is a human characteristic attributed to them.
Sidis IQ APTITUDE & ABILITY   -   Analytical Reasoning

An office building has five floors, numbered one through five. Each floor has a different color carpet: red, blue, green, yellow, and white. The following conditions must be met: i. The red carpet cannot be on the top floor. ii. The blue carpet must be above the green carpet but below the yellow carpet. iii. The white carpet must be on a higher floor than the green carpet but cannot be on the top floor. In which of the following arrangements is the sequence of floors correctly matched with the colors of their respective carpets?

The arrangement follows all the given conditions: red is not on the top floor, blue is above green and below yellow, and white is above green but not on the top floor.
Sidis IQ APTITUDE & ABILITY   -   Analytical Reasoning

In a certain company, there are seven executives: Adam, Ben, Chris, David, Emily, Fiona, and Grace. They are seated in a row of chairs. The following conditions must be met: i. Adam cannot sit next to Chris or Emily. ii. Ben must sit next to David. iii. Fiona cannot sit at either end of the row. Which of the following is a valid arrangement of the executives?

In this arrangement, all the given conditions are met: Adam is not next to Chris or Emily, Ben is next to David, and Fiona is not at either end of the row.
Sidis IQ APTITUDE & ABILITY   -   Analytical Reasoning

Five friends – Alex, Brian, Chris, David, and Eric – are participating in a singing competition. They will perform one after the other. The following conditions must be met: i. Alex cannot perform before David or Eric. ii. Brian must perform before Chris. iii. David cannot be the first or last to perform. In which of the following sequences can the friends perform according to the given conditions?

This sequence satisfies all conditions: Alex does not perform before David or Eric, Brian performs before Chris, and David is neither first nor last.
Sidis IQ APTITUDE & ABILITY   -   Analytical Reasoning

In a chess tournament, there are six players: Alice, Bob, Carol, David, Emily, and Frank. Each player plays exactly once against each of the other players. The following conditions must be met: i. Alice must play against Bob and Emily. ii. Carol cannot play against David or Frank. iii. Emily must play against Alice and David. How many different matches can be played in total?

There are six players, so each player plays against five other players. However, the matches involving Alice, Emily, and Carol are determined by the given conditions, resulting in 12 matches.
Sidis IQ APTITUDE & ABILITY   -   Analytical Reasoning

Five books – A, B, C, D, and E – are placed on a shelf. The following conditions must be met: i. Book A cannot be placed next to book B. ii. Book C must be placed between books B and D. iii. Book E must be placed somewhere to the right of book A. Which of the following represents a valid arrangement of the books on the shelf, from left to right?

In this arrangement, all the given conditions are met: A is not next to B, C is between B and D, and E is to the right of A.
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Double entry book-keeping was fathered by?

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Funds Flow Statement and sources and application statement are:

Fani Warraich

Good

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Depreciation in spirit is similar to

Fani Warraich

option c is not correct but B

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Balance Sheet is always prepared

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

In Insurance, the following Profit and Loss Accounts are prepared

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Quick Ratio can be computed as under

The quick ratio is calculated by dividing a company's current liabilities by the value of its "quick" assets. Cash and assets that may be turned into cash quickly, often within 90 days, are referred to as "quick assets."
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

In straight line method of depreciation, the written down value of a fixed asset will be at the end of the life of the asset as under

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Consolidation of subsidiary accounts in the balance sheet of a unlisted Holding company is at present in Pakistan

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Retained earning is synonymous to

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

The requirements of an audit report for a Banking Company in Pakistan is under

Fani Warraich

b and c are same. why?

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Deferred Taxation is part of

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Investment Corporation of Pakistan follows

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Directors Report is mandatory in respect of financial report constituent of

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Every limited Company in Pakistan is required by law to include the following along with financial reports

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Cash budget excludes the following

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

NGOs are legally required to

Fani Warraich

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Farid Uddin

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Fani Warraich

Testing comments on mobile

Fani Warraich

Reading mcqs under main subject

Jamal Khan MANAGEMENT SCIENCES   -   Financial Accounting

Operating Profit is

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Books of original entry are called

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

For preparing balance sheets prepaid expenses are shown as part of

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Unpaid and unrecorded expenses are called

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Amount, cash, or other assets removed from business by owner is called

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Under the diminishing balance method, depreciation amount is

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Users of accounting information includes

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

The business form(s) in which the owner(s) is (are) personally liable is (are) the

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

The investment of personal assets by the owner

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

All of the following are forms of organizations except

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

A cash purchase of supplies would

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

An owner investment of each into the business would

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

The payment of rent each month for office space would

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Real accounts are related to

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Which one of the following accounts would usually have a debit balance?

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Accounting

Quick assets include which of the following?

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

Accounting principles are generally based on the principle of

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

Rent paid to the land lord should be credited to

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

In the event of dissolution of a partnership firm the provision for doubtful debts is transferred to

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

A prospectus for share can be issued only by

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

Preliminary expenses are

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

The valuation of closing stock is at

As per materiality concept, on account of playing safe, accountant must record assets at lower of either market or cost price.
Fani Warraich

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Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

A liability in the amount of Rs. 500/- is paid in cash which of the fallowing is true

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

Which one of the following account normally have a credit balance?

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

A company collected one year’s rent in advance on October 1st ,2022 the entries Rs 1200 was credited to unearned revenue account the adjusting entry at the December 31,2022 year ended would include

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

When a small stock dividend is declared which of the fallowing accounts is credited

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Accounting

An advantages of the partnership form of business organization is its

Diginy Dash MANAGEMENT SCIENCES   -   Financial Accounting

In balance sheet accumulated loss of company shown as

Diginy Dash MANAGEMENT SCIENCES   -   Financial Accounting

Double Entry Book Keeping was fathered by

Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Which of the following statements is NOT true about the relationship between the chronological journal and the general journal?

While the chronological journal captures transactions in real-time, it's not a mandatory step. Transactions can be directly recorded in the general journal with proper explanations.
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

A company mistakenly recorded a purchase of inventory for $10,000 as an expense. How can a strong internal control system help identify this error most effectively?

egregation of duties (b) ensures the purchasing department raises a purchase order, which the accounting department uses to record the inventory purchase. This prevents the accidental recording of the purchase as an expense. While bank reconciliations (a) and general ledger reviews (d) are important controls, they might not catch this specific error.
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

Company A uses a single general journal for all transactions, while Company B utilizes a sales journal and a purchases journal. Which company is likely to be more efficient in recording transactions?

Special journals like sales and purchases journals (b) group similar transactions, reducing repetitive entries and saving time. This is particularly beneficial for companies with high transaction volumes.
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

A company has a trial balance that balances perfectly. Does this guarantee the absence of errors in the journals and general ledger?

A balanced trial balance (a) only indicates equal total debits and credits. Transposition errors (e.g., $125 instead of $251) or recording an expense as an asset with the same amount wouldn't affect the balance (b).
Fani Warraich MANAGEMENT SCIENCES   -   Financial Accounting

A company pays rent for a full year upfront on January 1st for $12,000. How should this transaction be recorded in the journals?

Since the rent benefits the entire year, it's treated as a prepaid expense (b). Option (c) wouldn't capture the full cost upfront. The answer depends on the company's policy (d) for handling prepaid expenses. Some companies might choose to record monthly rent expense based on an accrual basis.
Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

Flexible budget is a budget with the following features

Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

Break Even can be calculated as under

Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

Sales budget must be prepared

Jamal Khan MANAGEMENT SCIENCES   -   Cost & Management Accounting

Fixed Cost

Jamal Khan MANAGEMENT SCIENCES   -   Cost & Management Accounting

Conversion cost is equal to

Jamal Khan MANAGEMENT SCIENCES   -   Cost & Management Accounting

Process Costing method is related to

Jamal Khan MANAGEMENT SCIENCES   -   Cost & Management Accounting

A good Cost Accounting System is

Bashir Farooqi MANAGEMENT SCIENCES   -   Cost & Management Accounting

Net income plus operating expenses is equal to

Bashir Farooqi MANAGEMENT SCIENCES   -   Cost & Management Accounting

The maximum number of partners in Pakistan can be fixed at the following

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Cost & Management Accounting

The master budget comprises of

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Cost & Management Accounting

Cost volume profit analysis is the method used to estimate the impact on profit is of changes in

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Cost & Management Accounting

In a manufacturing company product cost include

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Cost & Management Accounting

When purchase merchandise is returned under a perpetual inventory system a credit would be made to

Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

Which of the fallowing accounts would not be included in the computation of the cost of goods sold

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Cost & Management Accounting

Total manufacturing cost for a period includes all of the fallowing except

Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

What is the primary purpose of calculating the Cost of Goods Sold (COGS)?

COGS is calculated to determine the cost of goods sold during a period, which is then used to calculate the profit margin (Gross Profit = Sales - COGS). This helps management evaluate the profitability of their products and make informed decisions.
Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

A company has the following costs: Direct Materials: Rs. 100,000 Direct Labor: Rs. 150,000 Overheads: Rs. 50,000 (25% of which is fixed) Opening Inventory: Rs. 20,000 Closing Inventory: Rs. 30,000 What is the COGS?

COGS = Opening Inventory + (Direct Materials + Direct Labor + Overheads) - Closing Inventory = 20,000 + (100,000 + 150,000 + 50,000) - 30,000 = 20,000 + 300,000 - 30,000 = 290,000 - 30,000 = 240,000
Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

A company has two products, A and B. The cost of producing one unit of A is Rs. 100, and the cost of producing one unit of B is Rs. 150. If the company sells 100 units of A and 50 units of B during a period, what is the total COGS?

COGS = (Units sold x Cost per unit) = (100 x 100) + (50 x 150) = 10,000 + 7,500 = 17,500 (but this option is not available, so the closest answer is c) Rs. 20,000)
Fani Warraich MANAGEMENT SCIENCES   -   Cost & Management Accounting

What is the effect on COGS if the opening inventory is overvalued?

If the opening inventory is overvalued, it means that the cost of goods already produced is higher than the actual cost. As a result, the COGS will be lower than the actual cost, making it understated.
Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Corporate Finance

Short-term loan can be described as having maximum period

Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

A company is evaluating a project with a positive NPV (Net Present Value) but significant upfront investment. The project also has the flexibility to be abandoned after year 2 if market conditions worsen. How can this flexibility be best incorporated into the capital budgeting decision?

While IRR considers time value of money, it doesn't explicitly account for flexibility. Ignoring the abandonment option (b) undervalues the project's potential. Real options analysis (c) recognizes the value of abandoning the project if market conditions deteriorate.
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

Company A has a debt-to-equity ratio of 0.5, while Company B has a ratio of 2.0. Which company is likely to have a higher weighted average cost of capital (WACC)?

Increased leverage (b) raises the risk profile, potentially leading to a higher cost of debt and a higher overall WACC.
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

A company with strong future growth prospects unexpectedly announces a significant increase in its dividend payout. According to signaling theory, what might this decision signal to investors?

Signaling theory suggests an unexpected dividend increase might signal strong future prospects and excess cash flow (b), leading to a potential increase in the stock price.
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

Company X is considering acquiring Company Y. Synergies from the M&A are expected to arise from combining their sales forces. However, significant integration costs are also anticipated. How should these factors be best considered when evaluating the M&A?

A successful M&A requires a thorough analysis of both synergies (b) and integration costs. While combining sales forces could lead to cost savings, the integration process itself can be expensive. Ignoring these costs can lead to an overestimation of the M&A's overall value.
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

A company has a debt-to-equity ratio of 2:1 and a cost of debt of 6%. If the tax rate is 30% and the cost of equity is 12%, what is the company's weighted average cost of capital (WACC)?

WACC = (Cost of Debt x Debt Proportion) + (Cost of Equity x Equity Proportion) = (6% x 2/3) + (12% x 1/3) = 4% + 4% = 8% But since interest on debt is tax deductible, the effective cost of debt is 6% x (1 - 0.30) = 4.2% So, WACC = (4.2% x 2/3) + (12% x 1/3) = 10.1%
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

A project has an initial investment of Rs. 100,000 and is expected to generate cash flows of Rs. 30,000 per year for 5 years. What is the project's payback period?

Payback Period = Initial Investment / Annual Cash Flow = 100,000 / 30,000 = 3.33 years (but this option is not available, so the closest answer is c) 4.17 years)
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

Which of the following capital budgeting techniques takes into account the time value of money?

Net Present Value (NPV) takes into account the time value of money by discounting future cash flows to their present value using a discount rate. The other options do not consider the time value of money.
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

A company has a beta of 1.2 and the market return is 10%. What is the company's cost of equity using the Capital Asset Pricing Model (CAPM)?

CAPM = Risk-Free Rate + Beta x (Market Return - Risk-Free Rate) Assuming a risk-free rate of 5%, the company's cost of equity is: = 5% + 1.2 x (10% - 5%) = 5% + 1.2 x 5% = 5% + 6% = 12.4%
Fani Warraich MANAGEMENT SCIENCES   -   Corporate Finance

What is the main advantage of using debt financing over equity financing?

Debt financing provides financial leverage, which means that a company can generate higher returns on equity by using debt to finance its operations. This is because debt is a cheaper source of financing compared to equity, and interest on debt is tax deductible.
Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Management

Sources of funds can be increased by

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Management

Economic resources of a business that are expected to be of benefit in the future are referred to as

Bashir Farooqi MANAGEMENT SCIENCES   -   Financial Management

An owner investment of land into the business would

Muhammad Tayyab Ikhlas MANAGEMENT SCIENCES   -   Financial Management

Quick Asset includes which of the fallowing

Fani Warraich MANAGEMENT SCIENCES   -   Marketing

Which of the following marketing strategies involves creating a series of small, incremental product improvements to maintain customer interest and loyalty?

Continuous innovation involves making small, incremental improvements to existing products to maintain customer interest and loyalty. This strategy is often used by companies to stay ahead of competitors and keep customers engaged.
Fani Warraich MANAGEMENT SCIENCES   -   Marketing

Which of the following consumer behavior models suggests that consumers go through a process of need recognition, information search, evaluation of alternatives, purchase, and post-purchase evaluation?

The Consumer Decision-Making Process is a widely accepted model that describes the stages consumers go through when making purchasing decisions. It helps marketers understand consumer behavior and develop effective marketing strategies.
Fani Warraich MANAGEMENT SCIENCES   -   Marketing

Which of the following marketing metrics measures the return on investment (ROI) of a marketing campaign by comparing the revenue generated to the cost of the campaign?

Marketing Return on Investment (MROI) is a key metric that helps marketers evaluate the effectiveness of their campaigns. It calculates the return on investment by comparing revenue generated to campaign costs.
Fani Warraich MANAGEMENT SCIENCES   -   Marketing

Which of the following marketing strategies involves creating a unique and memorable brand identity to differentiate a product or service from competitors?

Branding involves creating a unique and memorable brand identity to differentiate a product or service from competitors. This includes elements such as logos, taglines, and brand messaging.
Fani Warraich MANAGEMENT SCIENCES   -   Marketing

Which of the following marketing channels involves using opinion leaders to promote products or services to their followers?

Influencer marketing involves partnering with influencers or opinion leaders to promote products or services to their followers. This can be an effective way to reach new audiences and build brand credibility.
Fani Warraich

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Contributor(7)

Fani Warraich
Anna
Bashir Farooqi
Jamal Khan
Muhammad Tayyab Ikhlas
Diginy Dash
Sidis