Profitability Index MCQs with Answers PDF Download – Test 70

MCQ 346: The process in which the managers of the company identify projects to add value is classified as:

1. capital budgeting
2. cost budgeting
3. book value budgeting
4. equity budgeting

MCQ 347: In the situation of bankruptcy, the stock which is recorded above common stock and below debt account is:

1. debt liabilities
2. preferred stock
3. hybrid stock
4. common liabilities

MCQ 348: The greater value of the option, the larger span of time value is usually results in:

1. shorter call option
2. longer call option
3. longer put option
4. shorter put option

MCQ 349: If security pays $5,000 in 20 years with 7% annual interest rate, the PV of security by using formula is:

1. 1292.10 dollars per year
2. 1292.10 dollars
3. 0.00077 dollars per year
4. 16105.1 dollars per year

MCQ 350: In the portfolio, the beta of individual security in portfolio represented as their weighted average is classified as:

1. average of portfolio
2. beta of portfolio
3. weighted portfolio
4. collective stocks