Model Question for Management Trainee (MT)

27 Feb 2021 20:18

The three forms of organizations are:

Corporation, Partnership, and Public Limited Company ____
Proprietorship, Partnership, and Corporation ____
Partnership, Entrepreneurship, and Corporation ____
Corporation, Entrepreneurship, and Public Limited Company ____

The two types of Financial Markets are

Primary Markers and Secondary Markets ____
Dealer Markets and Auction Markets ____
Shares’ Markets and Bonds’ Markets ____
Equity Markets and Debt Markets ____

The two types of Secondary Markets are

Shares’ Markets and Bonds’ Markets ____
Financial Markets and Capital Markets ____
Dealer Markets and Auction Markets ____
Primary Markets and Premier Markets ____

The more debt a firm has (as a percentage of assets), the greater is its degree

liquidity ____
financial leverage ____
operating leverage ____
none of the above ____

Asset accounts normally have debit balances, to increase an asset account, we need to
1. debit the account ____
2. credit the account ____
3. both debit and credit the account ____
4. none of the above ____

To decrease an asset account, we need to
1. debit the account ____
2. both debit and credit the account ____
3. credit the account ____
4. none of the above ____

Liability accounts normally have credit balances, to increase a liability account, we need to
1. both debit and credit the account ____
2. credit the account ____
3. debit the account ____
4. none of the above ____

To decrease a liability account, we need to
1. debit the account ____
2. credit the account ____
3. both debit and credit the account ____
4. none of the above ____

The interest rate required in the market on a bond is referred to as the bond’s
1. discount rate ____
2. maturity return rate ____
3. yield to maturity ____
4. all of the above ____

When a bond sells for less than its face value, it is referred to as a
1. premium bond ____
2. discount bond ____
3. treasury bill ____
4. debenture ____

When a bond sells for more than its face value, it is referred to as a
1. high risk bond ____
2. low risk bond ____
3. premium bond ____
4. discount bond ____

The two factors that will have an impact on the bond’s sensitivity are:
1. maturity and coupon rate ____
2. yield to maturity and coupon rate ____
3. maturity and yield to maturity ____
4. coupon rate and face value ____

Corporate Bonds are normally classified under two distinctive forms. These are:
1. treasury bills and security bonds ____
2. positive covenant and negative covenant ____
3. high risk form and low risk form ____
4. registered form and bearer form ____

14. Created by Merrill Lynch, this type of bond which is very popular having features like callable, puttable, convertible, zero coupon and subordinated note, is referred to

a. Original Issue Discount Bond ____

b. Liquid Yield Option Note ____

c. Convertible Bond ____

d. Floating Rate Bond ____

Consider the following statement and choose the correct answers: A Governmental bond with a twenty year maturity period and a face value of $1000, with a coupon rate of 10% pays semi-annual interest, but investors expect 12% return.

Based on the above information, the Value of the Bond can be determined to be:

$849.54 ____
$862.76 ____
$826.52 ____
$832.12 ____

As per the given information, the effective annual yield on the bond can be calculated to be

12.12% ____
12.24% ____
12.36% ____
12.48% ____

Consider the following information, and choose the correct answers to the statements given below:

Global Inc., has recently paid a cash dividend of $2 per share. Investors require 16% return on such investments. The dividend is expected to grow at a steady 8% per annum.

Based on the above information and Dividend Growth Model, the current value of the stock is

$24 ____
$27 ____
$32 ____
$18 ____

Based on the Dividend Growth Model, the dividend in five years will be equal to

$2.16 ____
$3.12 ____
$3.45 ____
$2.94 ____

Using the Dividend Growth Model, the price of the stock in five years can be calculated to be

$36.50 ____
$39.67 ____
$32.45 ____
$41.14 ____

NYSE Members who execute customer orders to buy and sell stock transmitted to the exchange floor are referred to as

stock specialists ____
floor brokers ____
commission brokers ____
floor traders ____

Walter E. Heller Corporation has provided as follows, the Income Statement and the Balance Sheet for the year 2016. Based on the given information, choose the correct answers:

INCOME		BALANCE SHEET (Assets)
Sales	$2,590,614.00	Assets
Cost of Goods sold	$1,617,253.00	Cash	$ 183,415.00
Gross Profit	$ 973,361.00	Accounts Receivables	$ 542,659.00
Selling, general, and administrative expenses	$ 410,060.00	Inventories	$ 168,616.00
Depreciation & Amortization	$ 113,822.00	Other Current Assets	$ 54,304.00
Operating Profit	$ 449,479.00	Total Current Assets	$ 948,994.00
Interest Expense	$ 28,686.00	Gross Plant, property, and equipment	$ 1,244,185.00
Income before Taxes	$ 420,793.00	Accumulated Depreciation	$ (562,444.00)
Income Taxes	$ 153,592.00	Net Plant, property, and equipment	$ 681,741.00
Net Income	$ 267,201.00	Other Assets	$ 481,342.00
		Total Assets	$ 2,112,077.00

BALANCE SHEET (Liabilities and Equity)
Liabilities		Equity
Accounts Payable and accruals	$ 256,086.00	Common Stock
Short Term Debt	$ 262,068.00	Par Value and Paid in Capital	$ 49,771.00
Total Current Liabilities