NCERT Class 11 Chapter 8 Business Studies Sources of Business Finance MCQ

NCERT Class 11 Chapter 8 Business Studies Sources of Business Finance MCQ | Questions & Answers: Multiple Choice Questions that are provided here about the Class 11 Chapter 8 Business Studies Sources of Business Finance will help you guys in learning and enhancing your existing knowledge about the Sources of Business Finance concept.

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1. Which of the following statement is TRUE regarding debt?

A. Debt is an ownership interest in the firm.

B. Unpaid debt can result in bankruptcy or financial failure

C. Debt provides voting rights to the bondholders.

D. Corporation’s payment of interest on debt is fully taxable.

2. Dividend is paid only on _____

A. Loans

B. Debentures

C. Bonds

D. Shares

3. Funds raised through loans or borrowings are _____

A. Borrowed funds

B. Owners Equity

C. None of these

D. Share Capital

4. Internal sources of capital are those that are

A. generated through outsiders such as suppliers

B. generated through loans from commercial banks

C. generated through issue of shares

D. generated within the business

5. If a firm’s debt ratio is 45%, this means _____ of the firm’s assets are financed by equity financing.

A. 50%

B. 55%

C. 45%

D. Cannot be determined without more information

6. Industrial Finance Corporation of India (IFCI) was established in ____

A. July 1948

B. July 2001

C. July 1956

D. July 1991

7. The term 'redeemable' is used for

A. Preference shares

B. Commercial paper

C. Equity shares

D. Public deposits

8. ICICI was established in _________________

A. 1985

B. 1975

C. 1965

D. 1955

9. Money obtained by issue of shares is known as _____

A. Debts

B. Share Capital

C. Loans

D. Reserve Funds

10. Which of the following is a series of constant cash flows that occur at the end of each period for some fixed number of periods . . . .

A. Ordinary annuity

B. Annuity due

C. Perpetuity

D. A and C

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11. Under the lease agreement, the lessee gets the right to

A. Share profits earned by the lessor

B. Participate in the management of the organization

C. Use the asset for a specified period

D. Sell the assets

12. The ordinary shares of a company are delivered to the depository bank; which in turn issues the depository receipts; known as ____

A. Commercial banks

B. ADR

C. None of these

D. GDR

13. Debentures represent

A. Fixed capital of the company

B. Permanent capital of the company

C. Fluctuating capital of the company

D. Loan capital of the company

14. Under the lease agreement, the lessee gets the right to

A. Use the asset for a specified period

B. Share profits earned by the lessor

C. Sell the assets

D. Participate in the management of the organisation

15. In which form of Business, owners have limited liability.

A. sole proprietorship

B. partnership

C. joint stock company

D. none of the above

16. An individual authorized by another person, called the principle to act on the latter’s on behalf is known as . . . .

A. Agent

B. Servant

C. Subordinate

D. Assistant

17. Public deposits are the deposits that are raised directly from

A. The public

B. The directors

C. The auditors

D. The owners

18. Which of the following is a series of constant cash flows that occur at the end of each period for some fixed number of periods?

A. Ordinary annuity

B. Annuity due

C. Perpetuity

D. None of the given options

19. Funds required for purchasing current assets is an example of

A. Fixed capital requirement

B. Ploughing back of profits

C. Working capital requirement

D. Lease financing

20. Which of the following factors that are considered to solve the financial problems of business organizations are- i. Cost of Capital Supply ii. Importance and Objectives of capital iii. Different types of benefits

A. i and ii

B. i and iii

C. ii and iii

D. i, ii and iii

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21. ______ was the first company in India to issue convertible zero interest debentures in January 1990

A. Mahindra and Mahindra

B. Adani Enterprise

C. Tata Motors

D. Reliance Limited

22. Investors who want steady income may not prefer ____________

A. Bonds

B. Equity Shares

C. Debentures

D. None of the above

23. Which of the following is a commercial bank?

A. Punjab National Bank

B. Canara bank

C. State Bank of India

D. All of the above

24. In which form of Business owners have limited liability is . . . .

A. Sole Proprietorship

B. Partnership

C. Joint Stock Company

D. Entrepreneurs