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: Risk that affects only a specific company is known as
A) Unsystematic risk
B) Systematic risk
C) Economic risk
D) Market risk
✅ Correct Answer: A
Explanation: Unsystematic risk can be reduced through diversification.
Q: A company’s retained earnings are shown under
A) Liabilities
B) Equity
C) Assets
D) Expenses
✅ Correct Answer: B
Explanation: Retained earnings are accumulated profits held under shareholders’ equity.
Q: A progressive tax system means
A) Lower income pays more
B) Tax decreases with income
C) Same tax for all
D) Tax increases with income
✅ Correct Answer: D
Explanation: In a progressive system, tax rates rise with higher income levels.
Q: When two assets have negative correlation
A) Portfolio risk is minimized
B) Portfolio return is maximized
C) Both assets fail together
D) Risk is irrelevant
✅ Correct Answer: A
Explanation: Negative correlation reduces overall portfolio risk through diversification.
Q: The breakeven point occurs where
A) Revenue equals profit
B) Revenue equals total costs
C) Revenue equals fixed costs
D) Revenue equals variable costs
✅ Correct Answer: B
Explanation: At breakeven, total revenue matches total costs, resulting in zero profit.