MGT211 Themes 7-9 by LGWT

MGT211 Final Term Preparation · Semester: Fall 2025 · Theme 7, 8, 9 · These MCQS Are Created From Handouts , VU Official · Lectures & PPT Slide Fall 2025 · You Can Discuss Your Problems in these groups: ·  Community Link: ·  VU STUDY LGWT: ·  1st Semester: ·  Handouts & Files Papers: ·  Assignment, Quiz & GDB Solution:

Theme 7: Business Finance and Financial Systems (Modules 100-111)

Topic: Introduction to Finance & Sources of Funds

Q1. Finance is often referred to as the _______ of a business.

1. Brain
2. Heart
3. Lifeblood
4. Skeleton

Q2. Which of the following is NOT a key role of finance in business?

1. Raising Capital
2. Managing Costs
3. Designing Logos
4. Ensuring Profitability

Q3. Expenditures on long-term assets like machinery, land, and buildings are known as:

1. Operating Expenses (OpEx)
2. Capital Expenditures (CapEx)
3. Revenue Expenditures
4. Petty Cash

Q4. Day-to-day running costs such as salaries, rent, and electricity bills are classified as:

1. Capital Expenditures
2. Operating Expenses (OpEx)
3. Fixed Assets
4. Equity

Q5. Which type of financing involves selling ownership shares in the business?

1. Debt Financing
2. Equity Financing
3. Trade Credit
4. Lease Financing

Q6. A major disadvantage of Equity Financing is:

1. It must be repaid with interest
2. It causes bankruptcy risk
3. Ownership is diluted
4. It is only for short term

Q7. Debt Financing involves borrowing money that must be repaid with:

1. Ownership stake
2. Interest
3. Dividends
4. Voting rights

Q8. "Retained Earnings" is an example of which source of finance?

1. External Financing
2. Debt Financing
3. Internal Financing
4. Public Financing

Q9. Which of the following is considered a "Short-term" source of finance (less than one year)?

1. Bonds
2. Venture Capital
3. Trade Credit
4. IPO

Q10. A bank arrangement that allows a business to withdraw more money than it has in its account is called:

1. Term Loan
2. Trade Credit
3. Bank Overdraft
4. Mortgage

Q11. Selling accounts receivable (invoices) to a third party for immediate cash at a discount is known as:

1. Leasing
2. Factoring
3. Budgeting
4. Compounding

Q12. Which of the following is a Long-Term financing option?

1. Credit Card
2. Trade Credit
3. Commercial Paper
4. Corporate Bonds

Q13. Venture Capital is typically best suited for:

1. Mature, stable companies
2. High-growth startups
3. Government agencies
4. Non-profit organizations

Topic: Securities Markets & PSX

Q14. The market where new securities are issued for the very first time (e.g., IPO) is called:

1. Secondary Market
2. Primary Market
3. Money Market
4. Commodity Market

Q15. Where do investors buy and sell existing securities?

1. Primary Market
2. Secondary Market
3. Private Equity Market
4. Venture Capital Market

Q16. IPO stands for:

1. Initial Private Offering
2. International Public Offering
3. Initial Public Offering
4. Internal Profit Organization

Q17. Which organization regulates the corporate sector and capital markets in Pakistan?

1. SBP (State Bank of Pakistan)
2. FBR (Federal Board of Revenue)