Which stage of the industry life cycle is more attractive to the investors?

• A) Pioneering stage
• B) Stabilization stage
• C) Expansion stage
• D) Declining stage

Identify the correct formula for the Dividend Discount Model.

• A) Value of stock = Earning per share / Expected rate - Interest growth rate
• B) Value of stock = Earnings per share / Interest rate - Expected growth rate
• C) Value of stock = Dividend per share / Growth rate - Dividend discount rate
• D) Value of stock = Dividend per share / Discount rate - Dividend growth rate

Which of the following ratios measure, how a company finances its assets?

• A) Debt coverage ratio
• B) Price to book value ratio
• C) Leverage ratio
• D) Price to sales ratio

What will be the effect on intrinsic value if the risk premium and required rate of return falls?

• A) It will have no effect
• B) It will fall
• C) It will rise
• D) It will fluctuate

Which of the following is the ratio of share price to stockholder equity?

• A) Leverage ratio
• B) Debt coverage ratio
• C) Price to book value ratio
• D) Price to sales ratio

In which of the following cases, it is most feasible to take a sell decision?

• A) Where the intrinsic value is lesser than the current market price
• B) Where the intrinsic value is equivalent to the current market price
• C) Where the current market price is double the intrinsic value
• D) Where the intrinsic value is greater than the current market price

When earnings yield on the KSE 100 index is more than the treasury yield, the stocks will be:

• A) Unattractive
• B) Attractive
• C) Stay on the same price
• D) None of the given options

Intrinsic value of a stock represents:

• A) Present value of future net cash flows
• B) Future value of future net cash flows
• C) Investment value of future net cash flows
• D) Sum value of future net cash flows

Which one of the following is correct formula for calculating operating margin?

• A) Net Profit/Net Sales
• B) Operating income/credit sales
• C) Net income/Net Sales
• D) Operating income/Net Sales

Which of the following stage offers the highest potential returns and greatest risk?

• A) Pioneering stage
• B) Decline stage
• C) Stabilization stage
• D) Expansion stage

By which of the following analysis an investor could spot the degree to which a company is leveraged, or indebted?

• A) Security analysis
• B) Technical analysis
• C) Balance Sheet analysis
• D) Qualitative analysis

Which of the following statements highlights the financial condition of a company at any single point of time?

• A) Statement of Owner’s Equity
• B) Income Statement
• C) Cash Flow Statement
• D) Balance Sheet

ARS Company’s total sales for the year 2009 are Rs.500,000. Sales returns are of Rs.50,000. What will be the value of net sales for the company?

• A) Rs.550, 000
• B) Rs.475, 000
• C) Rs.425, 000
• D) Rs.450, 000

Which of the following is the advantage of the market measures to the investor.

• A) These measures identify the population to be measured and its method
• B) These measures quickly judge the overall portfolio performance
• C) These measures offer equivalents for common sizes and metric units
• D) These measures regulate the access to and cost of imports and exports

Current assets for company A are $ 20, 00, 000 and its current liabilities are of worth $ 15, 00,000. What will be its working capital?

• A) $400, 000
• B) $500, 000
• C) $250, 000
• D) $600, 000

In bottom-up approach of fundamental analysis, investors begin their analysis with:

• A) Company
• B) Market
• C) Industry
• D) Economy

Which of the following highlights expense control, asset and debt utilization?

• A) DuPont analysis
• B) Risk analysis
• C) Claims analysis
• D) Trend analysis

Balance sheet shows the:

• A) Balances of all accounts
• B) Net profit earned during a period
• C) Financial position of business
• D) Expense of a business

Which of the following estimates are needed while applying fundamental analysis to the market?

• A) All of given options
• B) Required return or earnings multiple
• C) Earnings and dividends
• D) Stream of shareholder benefits

Which of the followings is correct formula for quick ratio?

• A) Current Assets / Current Liabilities
• B) Current Assets + Inventory / Current Liabilities
• C) Current Assets + Prepayments / Current Liabilities
• D) Current Assets – Inventory / Current Liabilities