Author name: Administrator

254. A security plan begins with a(n) is ______.

A) security policy
B) risk assessment
C) implementation plan
D) security organization
✅ ANSWER: B
A security plan begins with a risk assessment. Risk assessment is a term used to describe the overall process or method where you: Identify hazards and risk factors that have the potential to cause harm (hazard identification). Analyze and evaluate the risk associated with that hazard (risk analysis, and risk evaluation).

31. Revenue and expense accounts are referred to as

A) Nominal accounts
B) Real account
C) Cash account
D) Bank account
✅ ANSWER: A
Revenue and expense accounts are referred to as Nominal accounts because each period they are closed out to Income Summary in the closing process.

259. Method and model used to analyze relationship between rates of return and risk is classified as

A) capital asset pricing model
B) portfolio asset pricing model
C) asset market pricing model
D) portfolio pricing model
✅ ANSWER: A
Method and model used to analyze relationship between rates of return and risk is classified as capital asset pricing model. The Capital Asset Pricing Model (CAPM) is a model that describes the relationship between the expected return. The return on the investment is an unknown variable that has different values associated with different probabilities. and risk of investing in a security.

32. Preliminary expenses are treated as

A) Fixed asstes
B) Current assets
C) Intangible assets
D) Miscellaneous expenditure
✅ ANSWER: D
Preliminary expenses are treated as Miscellaneous expenditure. Preliminary expenses are those that are incurred before incorporation of a company or commencement of business.

265. Traditional theorists believe that.

A) there exists an optimal capital structure
B) no optimal capital structure
C) equal optimal capital structure
D) 100% debt financial organizations
✅ ANSWER: A
Traditional theorists believe that there exists an optimal capital structure. An optimal capital structure is the objectively best mix of debt, preferred stock, and common stock that maximizes a company’s market value while minimizing its cost of capital.

267. Standard deviation is divided by expected rate of return is used to calculate

A) coefficient of variation
B) coefficient of deviation
C) coefficient of standard
D) coefficient of return
✅ ANSWER: A
Standard deviation is divided by expected rate of return is used to calculate coefficient of variation. The coefficient of variation (CV) is a statistical measure of the dispersion of data points in a data series around the mean.

269. Re-order level is calculated as:

A) Maximum consumption x Maximum re-order period
B) Minimum consumption x Minimum re-order period
C) 1/2 of (Minimum + Maximum consumption)
D) Maximum level – Minimum level
✅ ANSWER: A
Re-order level is calculated as Maximum consumption x Maximum re-order period. To calculate the reorder level, multiply the average daily usage rate by the lead time in days for an inventory item.

271. An average return of portfolio divided by its coefficient of beta is classified as

A) Sharpe’s reward to variability ratio
B) treynor’s reward to volatility ratio
C) Jensen’s alpha
D) treynor’s variance to volatility ratio
✅ ANSWER: B
An average return of portfolio divided by its coefficient of beta is classified as treynor’s reward to volatility ratio. The Treynor ratio, also known as the reward-to-volatility ratio, is a performance metric for determining how much excess return was generated for each unit of risk taken on by a portfolio.

273. Which is evidence of contract?

A) Policy document
B) Prospectus
C) Proposal form
D) FPR
✅ ANSWER: A
Policy document is evidence of contract. Policy document is a detailed document and it is the Evidence of the insurance contract which mentions all the terms and conditions of the insurance.
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