MGT411 Midterm MCQs by Team Aiza

Q1. Which of the following is NOT included in the definition of M1?

1. Currency
2. Gold coins issued by treasury
3. Traveler’s checks
4. Demand deposits

Correct answer: Gold coins issued by treasury

Q2. If the annual interest rate is 6%, the price of a 1-year Treasury bill with $100 face value would be:

1. $96.10
2. $94.00
3. $95.25
4. $94.33

Correct answer: $94.33

Q3. If a bond sells at premium, where price exceeds face value, then we would expect to see:

1. Market interest rates below the coupon rate
2. Market interest rate the same as the coupon rate
3. All of the given options
4. Market interest rates above the coupon rate

Correct answer: Market interest rates below the coupon rate

Q4. Consumer Price Index (CPI) measures the:

1. Changes in the cost
2. Changes in the quantity
3. Changes in the pricesD. Changes in the profit

Q5. The Pakistan Stock Exchange is considered a ----------------- because orders are routed to the exchange floor and then matched with an offsetting order.

1. O. T. C Market
2. All of given options
3. Derivative Market
4. Centralized Market

Correct answer: Centralized Market

Q6. ……………… provide the platform to complete the trading of financial instruments.

1. Financial Markets
2. Central Banks
3. Leasing Companies
4. Financial Companies

Correct answer: Financial Markets

Q7. Bonds that are issued by Government are called _________.

1. Callable Bonds
2. Government Bonds
3. Corporate Bonds
4. Treasury Bonds

Correct answer: Government Bonds

Q8. Which of the following expression is true?

1. Expected Return = P1XR1+P2XR2 ……… Pn*Rn
2. Expected Return = P1XR1/P2XR2……… Pn/Rn
3. Expected Return = P1XR1+P2XR2 ……… Pn+Rn
4. Expected Return = P1XR1-P2XR2………… Pn-Rn

Correct answer: Expected Return = P1XR1+P2XR2 ……… Pn*Rn

Q9. You deposit money into your bank account, which of the following entry Bank will pass in its books of account?

1. Debit your account
2. Debit the liability account
3. Reverse the entry
4. Credit your account

Correct answer: Credit your account

Q10. How much prices are possible of 06 commodities in the barter system?

1. 04
2. 15
3. 06
4. 10

Q1. When the auto manufacturing industry does poorly due to a recession this is an example of:

1. Idiosyncratic risk
2. Systematic risk
3. Unique risk
4. Risk premium

Correct answer: Systematic risk

Q2. Which of the following is considered more liquid market?

1. Bond Market
2. None of given options
3. Money Market
4. Equity Market

Correct answer: Money Market

Q3. Which one of the following is the narrowest definition of money?

1. M1
2. M3
3. M2
4. C

Q4. Economic growth mostly depends upon ---------.

1. O T C markets
2. Commission based markets
3. Well-developed markets
4. Primary markets

Correct answer: Well-developed markets

Q5. Wider the range of outcome wider will be the ___________.

1. Probability
2. Risk
3. Lose
4. Profit

Correct answer: Risk

Q6. Fundamental concept in time value of money is -----------.

1. Cash flow
2. Interest rate
3. Time period
4. Future value

Correct answer: Cash flow