CAIIB – ABFM – Mock Test- 07

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1. 
What factors can influence whether corporate diversification is beneficial? A) The degree to which revenues of the merging firms are correlated B) The size of the merged company C) The presence of negative or positive correlation between revenues D) The availability of market prices before the merger

2. 
In the context of capital budgeting for foreign investments, what can pose a problem due to rate volatility if the project implementation time is long?

3. 
What is one of the primary concerns regarding the valuation of intangible assets?

4. 
What is decision-making in the context of management?

5. 
What is mezzanine financing?

6. 
What is the significance of fairness in business dealings?

7. 
What advantages are associated with having a multigenerational workforce in any organisation? A) Problem-creating B) Understanding diverse audiences C) Occasions for educational growth D) Mentorship

8. 
How is the certainty equivalent coefficient calculated for the certainty equivalent method, as explained in the text? A) It is assumed to be constant for all years of a project's cash flows. B) It is obtained by considering the level of risk characterizing each year's cash flow. C) It is equal to the risk-free rate of return used in the calculation. D) It is predetermined and typically set at a constant value for all projects.

9. 
What is the minimum requirement for an incubator to be eligible for funding from the Startup India Seed Fund Scheme?

10. 
Which component of the formula for perfectly correlated cash flows in Hillier's Model primarily represents the risk associated with cash inflows?

11. 
What kind of loans can Indian companies use for acquiring shares of an overseas joint venture or wholly owned subsidiary?

12. 
What is the purpose of outplacement recruiting?

13. 
In the Value driver method for estimating the terminal value, what does "r" represent in the formula?

14. 
What are the steps in the basic control process in an organisation? A) Establishing goals and standards B) Comparing actual performance to predetermined goals C) Taking steps to make necessary corrections D) Continuing to monitor the effects of corrective actions E) Initiating new plans and objectives F) Delegating responsibility for corrective actions

15. 
What are the primary objectives of IT control in the context of business and accounting?

16. 
Seashore Limited has 20 lakh outstanding shares as of March 31, 2023. The market value of the company's equity is Rs. 9 Crore, with each share priced at Rs. 45. The company also has an outstanding debt of Rs. 18 Crore, which has a market valuation of Rs. 17.50 Crore. What is the total value of the company as of March 31, 2023, using the stock and debt approach?

17. 
How does a horizontal chart differ from a vertical chart in organization charts?

18. 
What could be a potential benefit of "lower financing costs" in mergers and acquisitions?

19. 
What is one of the definitions of 'Management' provided ?

20. 
What is the role of proper controls in the context of achieving organizational goal?

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