McqMate
These multiple-choice questions (MCQs) are designed to enhance your knowledge and understanding in the following areas: Bachelor of Financial Markets (B F M) .
| 101. |
Percentage of buyback of shares should not exceed --------- of the aggregate of the paid up capital and free reserves of the company. |
| A. | 25% |
| B. | 50% |
| C. | 40% |
| D. | 51% |
| Answer» A. 25% | |
| 102. |
Ratio of aggregate of secured and unsecured debt owned by the company after buyback should not be more than ---------the paid up capital and free reserves. |
| A. | Equal |
| B. | Twice |
| C. | Thrice |
| D. | Half |
| Answer» B. Twice | |
| 103. |
Declaration of solvency shall be signed by at least ------- directors one of whom shall be the managing director. |
| A. | 2 |
| B. | 3 |
| C. | 4 |
| D. | 5 |
| Answer» A. 2 | |
| 104. |
Letter of offer shall be dispatched to the shareholders within---------- days from its filing with Registrar of Companies containing factual information. |
| A. | 21 |
| B. | 15 |
| C. | 30 |
| D. | 10 |
| Answer» A. 21 | |
| 105. |
The offer for buyback shall remain open for minimum period of -------days. |
| A. | 21 |
| B. | 15 |
| C. | 30 |
| D. | 10 |
| Answer» B. 15 | |
| 106. |
Every buyback shall be completed within a period of------------------- from the date of passing of board or special resulation. |
| A. | One year |
| B. | Six months |
| C. | Three months |
| D. | One month |
| Answer» A. One year | |
| 107. |
Extinguish and physically destroy the shares and other specified securities buyback within ---- days of the last date of completion of a buyback. |
| A. | 21 |
| B. | 15 |
| C. | 30 |
| D. | 07 |
| Answer» D. 07 | |
| 108. |
Shares to be bought back must be --------- |
| A. | fully paid up |
| B. | Unpaid shares |
| C. | Forfeited shares |
| D. | Preference shares |
| Answer» A. fully paid up | |
| 109. |
Approval of Board of directors upto ------ % of the total paid up equity capital and free reserves of the company. |
| A. | 10 |
| B. | 15 |
| C. | 25 |
| D. | 50 |
| Answer» A. 10 | |
| 110. |
----------- growth provides an organisation with an aim of achieving accelerated or increased growth through mergers, amalgamation ect. |
| A. | Organic |
| B. | Inorganic |
| C. | Instant |
| D. | Gradual |
| Answer» B. Inorganic | |
| 111. |
In -------- swap merger, the holders of the target company's stock receive shares of the acquiring company's stock. |
| A. | Stock |
| B. | Debt -equity |
| C. | Interest |
| D. | Investment |
| Answer» A. Stock | |
| 112. |
-------------------- Capital can be considered as the permanent capital of company. |
| A. | Equity share |
| B. | Preference share |
| C. | Working |
| D. | Fixed |
| Answer» A. Equity share | |
| 113. |
For companies that publicly traded,negative reactions to the restructure can result in ----- stock prices. |
| A. | Dropping |
| B. | Increasing |
| C. | Stabilising |
| D. | Mobilizing |
| Answer» A. Dropping | |
| 114. |
--------- is a foreign currency denominated instrument tradeable on stock exchange generally in USA. |
| A. | ADRs |
| B. | GDRs |
| C. | DRs |
| D. | SDRs |
| Answer» A. ADRs | |
| 115. |
----------- is a foreign currency denominated instrument tradeable on stock exchange in countries other than USA. |
| A. | ADRs |
| B. | GDRs |
| C. | DRs |
| D. | SDRs |
| Answer» B. GDRs | |
| 116. |
Well managed companies make sufficient profit and retain in the form of -----------. |
| A. | Free Reserve |
| B. | Deposits |
| C. | Investment |
| D. | Financial instruments |
| Answer» A. Free Reserve | |
| 117. |
With ---------------- , lender can get a comprehensive financial footprint of a borrower. |
| A. | Credit report |
| B. | Project report |
| C. | Feasibility report |
| D. | Proposal |
| Answer» A. Credit report | |
| 118. |
The restructuring of a corporation should be undertaken if --------------- |
| A. | It can prevent an unwanted takeovers |
| B. | It is expected to create value for shareholders |
| C. | It is expected to increase the firm's revenue |
| D. | The interest of bondholders are not negatively affected |
| Answer» B. It is expected to create value for shareholders | |
| 119. |
In the long run, and successful acquisition is one that |
| A. | Enables the acquirer to make an all equity purchase |
| B. | Enables the acquirer to diversify it's assets base |
| C. | Increase the market price of the acquirer stock |
| D. | Increase financial leverage |
| Answer» C. Increase the market price of the acquirer stock | |
| 120. |
One means for a company to go private is ---------- |
| A. | Divestiture |
| B. | The pure play |
| C. | LBO |
| D. | The prepacked reorganisation |
| Answer» C. LBO | |
| 121. |
Which of the following reason do companies restrucre for? ---------- |
| A. | Change the ownership |
| B. | Just because they want to |
| C. | To stay competitive |
| D. | To overcome weakness |
| Answer» C. To stay competitive | |
| 122. |
When one company buys all or parts of another company is called -----------. |
| A. | Merger |
| B. | Demerger |
| C. | Recapitalisation |
| D. | Acquisition |
| Answer» D. Acquisition | |
| 123. |
An acquisition is the same thing as --------. |
| A. | a merger |
| B. | a spin-off |
| C. | a takeover |
| D. | an amalgamation |
| Answer» C. a takeover | |
| 124. |
The way in which merger and amalgamation occur do not include -------------- |
| A. | Horizontal integration |
| B. | Vertical integration |
| C. | Diversification |
| D. | Conglomerate takeovers |
| Answer» C. Diversification | |
| 125. |
The good reason for merger and amalgamation do not include ----------- |
| A. | Complementing business strategies |
| B. | Increasing earning per share |
| C. | Supporting value added growth |
| D. | Stopping a competitor merging or takeover |
| Answer» B. Increasing earning per share | |
| 126. |
Justification for merger and amalgamation do not include ------------ |
| A. | to achieve synergy |
| B. | to enter into new market |
| C. | to increase risk |
| D. | to gain economies of scale |
| Answer» C. to increase risk | |
| 127. |
Managerial motive for merger and amalgamation do not related to ------------- |
| A. | Dividend |
| B. | Power |
| C. | Job security |
| D. | Emoluments |
| Answer» A. Dividend | |
| 128. |
The three broad approaches to company valuation do not include ------------. |
| A. | Stock market valuation |
| B. | Assets valuation |
| C. | Inventory valuation |
| D. | Future earnings valuation |
| Answer» C. Inventory valuation | |
| 129. |
----------- in his book of 'Stategic Management 'has identified the strategy alternatives into four board strategies. |
| A. | William F. Glueck |
| B. | Henry Fayol |
| C. | Peter Drucker |
| D. | James Stonner |
| Answer» A. William F. Glueck | |
| 130. |
Merger or takeover may be provided for as a part of insolvency resulation plan under the Insolvency and Bankruptcy Code, ----------- |
| A. | 2000 |
| B. | 2012 |
| C. | 2014 |
| D. | 2016 |
| Answer» D. 2016 | |
| 131. |
--------------does not result in a expansion of the firm. |
| A. | Joint venture |
| B. | Merger |
| C. | Divestiture |
| D. | Acquisition |
| Answer» C. Divestiture | |
| 132. |
------------- does not involve a change in the ownership structure. |
| A. | Proxy contest |
| B. | Share repurchase |
| C. | LBO |
| D. | Going Private |
| Answer» A. Proxy contest | |
| 133. |
-------------is referred as 'as going private transaction 'initiate by the incumbent management. |
| A. | Management buyout |
| B. | Leveraged cash out |
| C. | Management Buy-in |
| D. | Leveraged recapitalisation |
| Answer» A. Management buyout | |
| 134. |
----------- forms one economic unit from two or more units is called ---------- |
| A. | Joint Ventures |
| B. | Merger |
| C. | Corporate control |
| D. | Divestiture |
| Answer» B. Merger | |
| 135. |
A public offer by one firm to directly buy the shares of another company is called -------- |
| A. | Merger |
| B. | Tender offer |
| C. | Spin off |
| D. | Divestiture |
| Answer» B. Tender offer | |
| 136. |
The sale of stock in wholly owned subsidiary via an IPO is referred as -------- |
| A. | Split up |
| B. | Equity carve out |
| C. | Counter tender offer |
| D. | Lockup transaction |
| Answer» B. Equity carve out | |
| 137. |
The distribution of shares in a subsidiary to existing parent company's stockholder is called ----------- |
| A. | Spin off |
| B. | Equity carve out |
| C. | Counter tender offer |
| D. | Lockup transaction |
| Answer» A. Spin off | |
| 138. |
Which of the following activities are commonly associated with takeover. |
| A. | The acquisition of assets |
| B. | Management buyout |
| C. | Leveraged buyout |
| D. | All the above |
| Answer» D. All the above | |
| 139. |
If Microsoft were to acquire U.S.Airways, the acquisition would be classified as -------- acquisition. |
| A. | Horizontal |
| B. | Conglomerate |
| C. | Vertical |
| D. | Market extention |
| Answer» B. Conglomerate | |
| 140. |
A dissident group solicits votes in an attempt to replace existing management is called -- ---- |
| A. | Tender offer |
| B. | Shareholders derivatives action |
| C. | Proxy contest |
| D. | Management freezout |
| Answer» C. Proxy contest | |
| 141. |
One of the most basic reason for a merger is -------- |
| A. | Enhance revenue |
| B. | Increase competition |
| C. | Cost reduction |
| D. | Employee benefits |
| Answer» C. Cost reduction | |
| 142. |
When a building supply store acquires a lumber mill is called as a -----------acquisition. |
| A. | horizontal |
| B. | Vertical |
| C. | Conglomerate |
| D. | Longitudinal |
| Answer» B. Vertical | |
| 143. |
The complete obsorption of one company by another, where in the acquiring fir retains its identity and the acquired firm cease to exist as a separate entity is called ----------. |
| A. | Merger |
| B. | Consolidation |
| C. | Spin off |
| D. | divestiture |
| Answer» A. Merger | |
| 144. |
A merger in which an entirely new firm is created and both the acquired and acquiring firm cease to exist is called --------------- |
| A. | Merger |
| B. | Consolidation |
| C. | Spin off |
| D. | divestiture |
| Answer» B. Consolidation | |
| 145. |
The payments made by a firm to repurchase shares of its outstanding stock from an individual investors in an attempt to eliminate a potential unfriendly takeover is called as ----- |
| A. | Golden parachute |
| B. | Standstill payment |
| C. | Greenmail |
| D. | Poison pill |
| Answer» C. Greenmail | |
| 146. |
A financial device designed to make unfriendly takeover attempts financially unappealing, if not impossible is called ------------ |
| A. | Golden parachute |
| B. | Standstill payment |
| C. | Greenmail |
| D. | Poison pill |
| Answer» D. Poison pill | |
| 147. |
Generous compensation packages paid to a firm's top management in event of a takeover referred as ---------- |
| A. | Golden parachute |
| B. | Standstill payment |
| C. | Greenmail |
| D. | Poison pill |
| Answer» A. Golden parachute | |
| 148. |
The ____________ process must involve a significant change in the management culture of the acquired business. |
| A. | Human Resource Management |
| B. | Post-Merger Integration |
| C. | General management integration |
| D. | Product and service development. |
| Answer» B. Post-Merger Integration | |
| 149. |
__________ are sought with an aim to trying to control the products and services feed by the involved business. |
| A. | Post-Merger Integration |
| B. | Product and service development |
| C. | Merger and Acquisition |
| D. | Financial market value |
| Answer» C. Merger and Acquisition | |
| 150. |
Management involves the ___________ of resources. |
| A. | Utilisation |
| B. | Analysis |
| C. | Culture |
| D. | Net Profit |
| Answer» A. Utilisation | |
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