Finance MCQs
Finance MCQs cover financial management, investment analysis, markets, and corporate finance. Ideal for MBA, CFA, and competitive exams like PPSC, FPSC, NTS, and SBP, they build concepts, analytical skills, speed, and accuracy through real-world scenarios.
Q: Systematic risk is also known as
A) Market risk
B) Business risk
C) Residual risk
D) Diversifiable risk
✅ Correct Answer: A
Explanation: Market risk, or systematic risk, affects all investments and cannot be eliminated through diversification.
Q: A share with no voting rights is called
A) Preference share
B) Common share
C) Equity share
D) Bonus share
✅ Correct Answer: A
Explanation: Preference shares often do not grant voting rights but provide fixed dividends.
Q: Liquidity is best defined as
A) Ability to invest in assets
B) Ability to convert assets to cash quickly
C) Ability to manage equity
D) Ability to meet long-term obligations
✅ Correct Answer: B
Explanation: Liquidity reflects how quickly assets can be converted to cash to meet obligations.
Q: The purpose of a budget is to
A) Record historical data
B) Control and plan financial activities
C) Measure employee performance
D) Predict inflation
✅ Correct Answer: B
Explanation: Budgets are financial plans that help organizations allocate resources and control spending.
Q: The gearing ratio evaluates
A) Investment returns
B) Asset turnover
C) Shareholder equity
D) Financial leverage
✅ Correct Answer: D
Explanation: Gearing ratio shows the proportion of debt in the capital structure, indicating financial leverage.