Management MCQs

Technique by which companies reduce cost of transaction services and results in increased efficiency is classified as

by
A. economies of cost
B. economies of scale
C. economies of efficiency
D. economies of transaction
✅ The correct answer is option B.
Technique by which companies reduce cost of transaction services and results in increased efficiency is classified as economies of scale. Economies of scale are cost reductions that occur when companies increase production. The fixed costs, like administration, are spread over more units of production. Sometimes the company can negotiate to lower its variable costs as well.

Return on sales is multiplied to investment turnover to calculate

by
A. residual income
B. return on investment
C. return on sales
D. investment turnover
✅ The correct answer is option B.
Return on sales is multiplied to investment turnover to calculate return on investment. Return on Investment (ROI) is a performance measure used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments. ROI tries to directly measure the amount of return on a particular investment, relative to the investment’s cost.

Need becomes ________ when they are directed towards a specific object.

by
A. Actual need
B. Want
C. Satisfaction
D. Demand
✅ The correct answer is option B.
Need becomes want when they are directed towards a specific object. Human wants are desires for specific satisfaction of deeper needs that means the needs become wants when they are directed to specific object that might satisfy the need.

Considering two fiscal years 2013 and 2014, an input price in 2013 and 2014 are $9 and $11 per unit respectively and input required units in 2013 to produce output in 2014 are 30000 units, then cost effect of price recovery will be

by
A. $60,000
B. $6,000
C. $65,000
D. $6,500
✅ The correct answer is option A.
Cost effect of price recovery = ($11 – $9) × 30000 units
= $60,000.

Risk of financial institutions which states mismatching assets maturities and liabilities maturities is classified as

by
A. selling intermediation
B. maturity intermediation
C. direct intermediation
D. indirect intermediation
✅ The correct answer is option B.
Risk of financial institutions which states mismatching assets maturities and liabilities maturities is classified as maturity intermediation. Maturity intermediation is an investment term that describes a bank’s long-term lending on funds borrowed for a short-term investment.

If price at which stock is purchased exceeds market value then stock warrants will

by
A. be exercised
B. not be exercised
C. be discounted
D. not be discounted
✅ The correct answer is option A.
If price at which stock is purchased exceeds market value then stock warrants will be exercised. A stock warrant represents the right to purchase a company’s stock at a specific price and at a specific date. A stock warrant is issued directly by a company to an investor. Stock options are purchased when it is believed the price of a stock will go up or down.