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Group A Economics Chapter Public Financing MCQs:

The Central Superior Services (denoted as CSS; or Bureaucracy) is an elite permanent bureaucratic authority, and the civil service that is responsible for running the civilian bureaucratic operations and government secretariats and directorates of the Cabinet of Pakistan.

Central Superior Services (CSS) -> Group A -> Economics -> Public Financing


Income that is saved and not invested is known as

A: Hoarding
B: Capital
C: Deposit
D: None
Answer: C


Dow Jones is stock exchange market of

A: New York
B: Tokyo
C: London
D: None of these
Answer: A


When the stock market is rising it is called

A: Upward tendency
B: Booming
C: Bullish
D: Hawkish
Answer: C


Standard deviation is 18% and expected return is 15.5% then coefficient of variation would be

A: 2.50%
B: 0.86%
C: 1.16%
D: −2.5%
Answer: C


According to Black Scholes model, stocks with call option pays the

A: Current price
B: Dividends
C: No dividends
D: Past price
Answer: C


A formula of after-tax component cost of debt is

A: Interest rate + tax savings
B: Interest rate-tax savings
C: Marginal tax-required return
D: Borrowing cost + embedded cost
Answer: B


A type of beta which incorporates about company such as changes in capital structure is classified as

A: Subtracted Beta
B: Industry Beta
C: Market Beta
D: Fundamental Beta
Answer: D


Cost of capital is equal to required return rate on equity in case if investors are only

A: Asset seller
B: Valuation manager
C: Common stockholders
D: Equity dealer
Answer: C


Cost of common stock is 16% and bond yield is 9% then bond risk premium would be

A: 1.78%
B: 7%
C: 8%
D: 25%
Answer: B
Atiqa Bano


Cost which has occurred already and not affected by decisions is classified as

A: Weighted cost
B: Sunk cost
C: Occurred cost
D: Mean cost
Answer: B
Rasool jan


Project which is started by firm for increasing sales is classified as

A: Firm borrowing project
B: New expansion project
C: Old expanded project
D: Product line selection
Answer: B


Cash flows that should be considered for decision in hand are classified as

A: Marginal cash flows
B: Relevant cash flows
C: Irrelevant cash flows
D: Transaction cash flows
Answer: B


Redemption option which protects investors against rise in interest rate is considered as

A: Redeemable at refund
B: Redeemable at deferred
C: Redeemable at par
D: Redeemable at finding
Answer: C


Bond which is offered below its face value is classified as

A: Coupon issued bond
B: Present value bond
C: Original issue discount bond
D: Discounted bond
Answer: C


In capital budgeting, number of non-normal cash flows have internal rate of returns are

A: Accepted
B: One
C: Multiple
D: Non-accepted
Answer: C


In capital budgeting, an internal rate of return of project is classified as its

A: Positive rate of return
B: External rate of return
C: Internal rate of return
D: Negative rate of return
Answer: C


An uncovered cost at start of year is divided by full cash flow during recovery year then added in prior years to full recovery for calculating

A: Payback period
B: Original period
C: Investment period
D: Forecasted period
Answer: A


Return on assets = 6.7% and equity multiplier = 2.5% then return on equity will be

A: 0.37%
B: 16.75%
C: 2.68%
D: 9.20%
Answer: B


Low price for earnings ratio is result of

A: Low dividends paid
B: Low riskier firms
C: High riskier firms
D: High marginal rate
Answer: B


Long-term equity anticipation security is usually classified

A: Short money options
B: Short-term options
C: Long-term options
D: Yearly call
Answer: C