Business Administration

(1) Public Accountants generally perform these services:

(a) Income tax services, Management Advisory services, and independent auditing
services

(b) Internal auditing, Income tax services and management controlling.

(c) Public accounting, private accounting and budgeting.
(d) None of the above is correct.

(2) Identify the organization created by Congress to regulate security markets including
flow of information from companies to public:

(a) TVM
(b) NPV
(c) IRR
(d) SEC

(3) Select the term that describes a cash distribution to a Corporation’s Stockholders:

(a) Paid out Capital (b) Cash Management

(c) A dividend
(d) None of these
(e) All of the above are correct

(4) Frederick Winslow Taylor work/book entitled the principles of Scientific Management is
published, in:
(a) 1875
(b) 1901
(c) 1911
(d) None of these

(5) One of the most successful Industrialists and the father of Modern Personnel
Management is:

(a) F.W. Taylor

(b) James Watt
(c) C. Babbage
(d) Robert Owen

(6) Who has the major Contributions in the Theory of Bureaucracy:

(a) Henry Gantt
(b) Hanri Fayal
(c) W.D. Scatt
(d) Max Weber
(e) None of these

(7) Which one, of the following MNCs (Multinational Co.) has the higher revenues during
mid. 1990s:

(a) General Motor

(b) IBM (c) AT &T
(d) General Electric
(e) None of the above

(8) Give the, name of the author who has the major contributions in the field of marketing:

(a) H. Koontz
(b) W.J. Stanton
(c) P.B. Miller
(d) Gitt Man
(e) All of these

(9) The profit margin is a ratio between the corporation’s net income and:
(a) Total expense (b) Total assets (c) Cost
(d) Total revenues (e) None of the above

(10) MNCs are responsible for the majority of Foreign Direct Investment (FDIs) and have a
higher revenues than the national income of some of the countries they serve:

(a) Fully agreed

(b) Not agreed
(c) It is not possible
(d) None of these

(11) Earned but uncollected revenues, that are recording the adjusted process, recorded
with a credit to the revenues and debit to the expense is called:

(a) Adjusted Trail balance

(b) Expenses
(c) Accrued revenues
(d) None of these

(12) Which one of the following is not a part/variable of the marketing Mix (4Ps):

(a) Product
(b) Price
(c) Place
(d) Person
(e) None of these
(13) The major steps in the accounting cycle are the following:

(a) The procedure used in worksheet

(b) Begin with Trail Balance
(c) Completed only once in business life
(d) None of the above
(e) All of these

(14) Which of the following items is not unique to the financial statements of merchandising
Companies?

(a) Cost of good sold

(b) Gross profit
(c) Account receivable
(d) Net sales
(e) All of the above
(f) None

(15) The repairs made to keep a plant/asset in normal and good operating condition are
called:

(a) Plant Management

(b) Operation Management
(c) Ordinary repairs

(16) A company that owns more than 50’s of another company and controls that
corporation is known as:

(a) Subsidizing
(b) Consolidated CO.
(c) None of these

(17) The process of individual growth in the full utilization of a person’s managerial
capabilities is called management development:

(a) True
(b) False

(18) Promotion is not a part of marketing:

(a) Agreed
(b) Not agreed
(c) None of these

(19) A way of analyzing leadership style where leaders are classified on a grid with TWO
dimensions is called:
(a) Managerial grid
(b) Two way theory
(c) None

(20) Robert Owen is known as the Father of Modern Personnel Management:

(a) Yes
(b) No
(c) May be Taylor

(1)Most preferred stock pays a fixed dividend at regular intervals.

(a) True
(b) False

(2) Any increase in an asset item is a source of funds.

(a) True
(b) False

(3) Depreciation is a book-keeping entry that allocates the cost of assets against income but
does not involve any movement of capital.

(a) True
(b) False

(4) The maturity of a security relates to the owner’s ability to convert it into cash on short
notice:

(a) True
(b) False

(5) The credit period represents the period of time during which a cash discount can be
taken on short notice.

(a) True
(b) False

(6) Which ratio is computed with the help of the following?

Cost of goods sold/Inventory

(a) Receivable turnover

(b) Times interest earned
(c) Inventory Turnover
(d) None of these
(7) ________ is the right that is delegated to an individual or a department to control
specific processes, practices, policies and other matters relating to activities undertaken by
person in other departments.

(a) Line authority

(b) Functional Authority
(c) Line and Staff Authority
(d) None of these (delegated authority)

(8) Decentralization is the tendency to disperse decision making in an organized structure:

(a) True
(b) False

(9) Programmes are plans which are general statements or understandings that guide or
channel thinking in decision making:

(a) True
(b) False

(10) _______ is that part of managing that involves establishing an international structure
of roles for people to fill in an organization:

(a) Leading
(b) Controlling
(c) Planning
(d) None of these (staffing)

(11) Henri Fayol applied the principle of ‘Division of Work’ to all kinds of work, managerial
as well as technical.

(a) True
(b) False

(12) ________ spell out specific required actions or non-actions, allowing no discretion:

(a) Procedures
(b) Budgets
(c) Rules
(d) None of these

(13) Business buyers are as geographically dispersed as final consumers.

(a) True
(b) False
(14) The distribution between a consumer good and an industrial good is based on the
purpose for which product is purchased:

(a) True
(b) False

(15) Intensive distribution occurs when the product is stocked in as many outlets as
possible.

(a) True
(b) False

(16) Merchant wholesalers are independently owned business that do not own (take title to)
the goods they sell:

(a) True
(b) False (merchant wholesalers take legal ownership of the goods they sell)

(17) Which of the following elements in a compensation package provides the greatest
amount of incentive for salespersons?

(a) Salary
(b) Fringe Benefits
(c) Commissions
(d) Use of Company Vehicle

(18) The process whereby the seller distinguishes between market segments, selects one or
more of these segments, and develops products and marketing-mixes tailored to each
segment is called _______ marketing.

(a) Mass
(b) Target
(c) Product Variety
(d) Service

(19) Goods that the consumer, in the process of selection and purchase, characteristically
compares on such bases as suitability, quality, price and style are called _______ goods.

(a) Shopping
(b) Specialty
(c) Unsought
(d) Convenience

(20) Product ______ is a period of rapid market acceptance and increasing profits.

(a) Development
(b) Introduction
(c) Growth
(d) Maturity

Write only “True” or “False” in the Answer Book. Do not reproduce the questions.

(1)Business risk is influenced by the firm’s decision to use debt in its financial
structure. False

(2) The most important function of management is controlling. False

(3) A short term creditor would consider liquidity ratios to be more important than efficiency
ratios. True

(4) According to Maslow, when a need is satisfied, it tends to lose its ability to
motivate. True

(5) The term marketing mix refers to the degree of advertising Vs personal selling used to
market product. False

(6) The difference between an agent and a merchant wholesaler is that an agent always
takes title but a merchant wholesaler does not. False

(7) The management of working capital is required because of a lack of short term
synchronization between demand and supply. True

(8) A manager who believes that people inherently dislike work probably accepts McGregor’s
Theory X. True

(9) Inventory carrying costs can be minimized by carrying fewer units in inventory. True

(10) A balance sheet is an accounting report used solely for the corporate form of
business. False

(B) Write only correct answer in the Answer Book. Do not reproduce the questions.

(11) For management, budgeting is perhaps the most powerful_____.

(a) Forecasting tool

(b) Control device
(c) Hiring tool
(d) Accounting measure

(12) The income statement is a summary of:

(a) Revenue and expenses

(b) Assets, liabilities and capital
(c) Increases and decreases in capital
(d) None of these

(13) One benefit of using ratio analysis when interpreting financial statements is that:

(a) Ratios facilitate comparisons between different companies.

(b) All ratios have exact standard values with which performance can be compared.
(c) Ratios take into account all the specific factors affecting particular companies and
industries.
(d) None of these

(14) Planting and policy making are primarily functions of:

(a) Top management

(b) Middle management
(c) Operating management
(d) None of these

(15) An informal organization often exists within a business because:

(a) Not all relationships can be specifically defined.

(b) Small organizations do not necessarily emphasize strict adherence to line authority.
(c) Human behavior naturally crosses established authority lines.
(d) All of these

(16) In marketing, selling and buying would be called the:

(a) Primary functions

(b) Exchange functions
(c) Profit functions
(d) Critical functions (not confirmed)

(17) Institutional advertising is:

(a) Aimed only at people in institutions

(b) Run only by institutions
(c) Designed to promote a type of product rather than a particular brand.
(d) Designed simply to show that the firm is a good place to do business.

(18) The current ratio of a firm having Rs. 25,000 of current assets, Rs. 30,000 of fixed
assets, Rs. 5000 of current liabilities and Rs. 10,000 of fixed liabilities would be:

(a) 5:1
(b) 7:1
(c) 10:1
(d) None of these

(19) The organizational form that replaces individual authority at all levels with group
representation is:

(a) Line
(b) Line and staff
(c) Functional
(d) Committee

(20) Working Capital may be expressed as:

(a) Current assets minus current liabilities

(b) Current and fixed assets minus current and fixed liabilities
(c) Current assets over current liabilities
(d) Current and fixed assets over current and fixed liabilities

Write only “True” or “False” in the Answer Book. Do not reproduce the questions.

(1) In a large corporation, the firm’s owners are usually its top
managers. False (stockholders)

(2) The basic information needed to construct a flow of funds statement is found on the
income statement. True (not confirmed)

(3) The operating break-even point is the point at which operating profits equal revenues
minus operating costs. False

(4) A sinking fund is a poorly performing mutual fund whose net asset value is
declining. True

(5) Penetration Pricing is used when a marketer introduces a new product at a relatively
high price. False

(6) The most common channel for consumer products is manufacturer-retailer-

consumer. True

(7) In the classification of consumer products, convenience products are usually more
expensive than shopping products. False

(8) During the maturity stage of the PLC, sales increase at faster rate than during any other
stage. False

(9) A wide span of management results in few organizational levels, and a narrow span
results in many levels. True

(10) The LINE relationship involves making decisions and acting on them. True

(11) Data is defined as “formal system of gathering, integrating, comparing, analyzing, and
dispersing information internal and external to the enterprise in a timely, effective and
efficient manner”. True

(12) A manager who believes that people inherently dislike work probably accepts
McGregor’s Theory X. True

(B) Write only the correct answer in the Answer Book. Do not reproduce the questions.

(13) If a manufacturer gives a 30 percent discount to retailers and a 10 percent discount to

wholesalers, which type of discount is being given?

(a) Quantity
(b) Cash
(c) Functional (also called trade discount)
(d) Seasonal

(14) Publicity differs from advertising in as much as:

(a) It is directed at large numbers of consumers.

(b) Its message is of a non personal nature.
(c) It is carried by the mass media.
(d) It is a non paid Form of reaching the public.

(15) In which stage of the PLC are promotion expenses per product item usually highest?

(a) Introduction
(b) Growth
(c) Maturity
(d) Decline

(16) Which of the following is not a disadvantage of using a Committee?

(a) High cost in time and money

(b) Splitting responsibility
(c) Group deliberation and judgment
(d) Compromise decisions

(17) Identify the Organization established by our Federal government to regulate security
markets:

(a) SBP
(b) SEC
(c) NAB
(d) NFC

(18) If the credit terms are 2/10, net 30 and the amount of invoice is Rs. 4000, how much
is the discount if the invoice is paid in 20 days?
(for example, the term 2/10, net 30 allows a customer to deduct 2% of the net amount
owed if the customer pays within 10 days of the invoice date. If a customer does not pay
within the discount period of 10 days, the net purchase amount (without the discount) is
due 30 days after the invoice date.)

(a) Zero
(b) Rs. 30
(c) Rs. 60
(d) Rs. 120

(19) Which of the following is not part of the promotion-mix?

(a) Public relations
(b) Product planning
(c) Personal selling
(d) Advertising

(20) Selling activities include:

(a) Sales presentations
(b) Demonstrations
(c) Handling objections
(d) Closing the sale
(e) None of these
__________________
Write only “True” or “False” in the Answer Book. Do not reproduce the questions.

(1)Planning initiates other functions of management. True

(2) Managements make things to happen. True

(3) The ultimate criterion of control is the extent that activities are complete in ways that
lead to more profits. False

(4) Computer Technology helps the management but does not replace the
management. True

(5) Promotional mix is also known as communication mix. True

(6) Marketing environment is made up of micro-environment and macro-environment. True

(7) Promotional mix is the part of marketing mix. True

(8) Marketing strategy consists of specific strategy for target markets, positioning, the
marketing mix and marketing expenditure levels. True

(9) A Financial manager has a full control over its firm’s stock price. False

(10) Liquidity ratios measure a firm’s ability to meet short term obligations.True

(11) The internal rate of return method is the most widely used capital budgeting
techniques. False (not confirmed)

(12) Stock exchange facilitates investment in real assets by providing secondary market to
the financial securities. True
(B) Write only correct answer in the Answer Book. Do not reproduce the questions.

(13) The organizing function of management includes:

(a) How tasks to be grouped.

(b) Conflict resolution among sub-ordinates.
(c) Comparison of actual results with a budget.
(d) Definition of organization’s goals.

(14) The key to motivating today’s diversified work force lies in:

(a) Creativity
(b) Goal setting
(c) Support
(d) Flexibility

(15) Control should be placed:

(a) Where they are cost-effective

(b) On all activities
(c) Where there are problem areas
(d) On the single most important

(16) The marketing logic by which the business unit hopes to achieve its marketing
objective is called:

(a) Business strategy

(b) Marketing strategy
(c) Production & distribution strategy
(d) All of these

(17) Strategic planning is the process of developing a formal strategy for:

(a) Identifying clear objectives

(b) Long run survival & growth
(c) Continuity & Consistency
(d) All of these

(18) Who are the true owners of Corporation?

(a) Debt holder

(b) Common stock holders
(c) Managers of the firm
(d) Board of directors

(19) What does an efficient port folio provide?

(a) Highest return for a given amount of risk
(b) Least rick for a given level of return
(c) Highest possible return and least amount of risk
(d) Both ‘a’ and ‘b’

(20) The economic order quaintly (ECQ) increases when which of the following increases?

(a) Sales
(b) Ordering costs
(c) Carrying costs
(d) Both ‘a’ and ‘b’

Select the best option/answer and fill in the appropriate box on the Answer Sheet. (20)

(i) The key inputs into Discounted Cash Flow analysis are projected future cash flows.
a) True
b) False

(ii) Market demand for a product is the total volume that would be sold by a defined
customer group.
a. True
b. False

(iii) Operational plans apply to the entire organization and establish the organization’s
overall goals.
a. True
b. False

(iv) Preferred stock has a fixed divided paid every period forever so preferred stock is
essentially a perpetuity.
a. True
b. False

(v) The cost of debt is the return that the firm’s debtors demand on new borrowing.
a. True
b. False

(vi) With the Internal Rate of Return, we try to find a single rate of return that summarizes
the merits of a project.
a. True
b. False

(vii) IBM is example of a manufacturer brand.

a. True
b. False
(viii) Modifying job responsibilities is an example of structural change.
a. True
b. False

(ix) ---------- is a statement reporting the effects of a firm’s operating, investing and
financing activities on cash flows over an accounting period.
a. Income statement
b. Annual report
c. Cash flow statement
d. Balance sheet
e. None of these

(x) ---------- studied five chief executives at work and identified ten managerial roles.
a. Max weber
b. Henry fayol
c. Henry mintzberg
d. Fredrick taylor
e. Michael porter

(xi) A product life cycle -----------------.

a. Shows how a product sales or profits may rise or fall over its life
b. Tells you how long a product will sell for and make a profit
c. Is divided into three stages
d. Show how profitable a product will
e. None of these

(xii) All of the following are fixed assets except

a. Building
b. Stocks
c. Production plant
d. Vehicles
e. None of these

(xiii) What is the influencing environmental factor when interest rates increase and firms
find it difficult to borrow funds
a. Political factor
b. Social factor
c. Economic factor
d. Technological factor
e. Competitive factor

(xiv) Which of the following is not a market entry strategy

a. Licensing
b. Indirect exporting
c. Joint venture
d. International marketing
e. None of these

(xv) ------------ is information about physical working conditions, work schedule and the
organizational and social context of the job.
a. Job specification
b. Job context
c. Work activities
d. HR policy manual
e. None of these

(xvi) The liquidity of a firm is a measure of ---------------

a. Its ability to pay bills
b. Its ability to respond to changes in demand
c. How flexible it is in its production plannning
d. How quickly and easily a firm could relocate to another site
e. None of these

(xvii) Market share means ---------------

a. How well a firm is doing
b. How much power affirm has in the market
c. How many firms are there in the market
d. How big a market is
e. None of these

(xviii) -------------- refers to a management philosophy that requires employers to

continuously set and relentlessly meet ever high quality, cost , delivery and availability
goals.
a. Performance management
b. Performance appraisal
c. Continuous improvement
d. Management by objective
e. None of these

(xix) Beta ------------.

a. Is a measure of firm specific risk
b. Is a measure of market risk
c. Is a measure of total risk
d. All of these
e. None of these

(xx) What is the price of a stock that is expected to pay a 1.00 divided next year if the cost
of capital is 14% and the growth rate is zero
a. 7.14
b. 6.75
c. 11.9
d. 6.13
e. None of these

i) You wish to borrow $ 8000 to be repaid in 24 monthly installments at an annual interest

rate of 8%. What is your monthly payment?

a) $ 262.82 b) $ 361.82 c) $ 150.5 d) $ 325.00 e) none

ii)If you invest $ 600 every six months at 8% compounded semi annually, how much would
you accumulate at the end of 10 years?

a) $15,883.20 b) $ 16,926.82 c)$ 17, 866.85 d) $ 18,233.45 e) None

iii) A commercial bank will loan you $ 12,250 for three years to by a car. The loan must be
repaid in 36 equal monthly payments. The annual interest rate on the loan is 12% of the
unpaid balance. How large are the monthly payments?

a) $425.00 b) $350.67 c) $375.09 d) $406.88 e)none

iv) What is the future value of $500 investment, with a stated rate of 6% compounded
monthly for 7 years.

a) 700 b) 730 c)760 d)790 e) none

v) You are considering investing in a preferred stock that has a dividend of $ 3.25 per
share. The market price of this stock is $ 48.625. What is the rate of return you would
expect to make on this perpetuity?

a) 6.68% b) 6.24% c) 6.05% d) 6.28% e) none

vi) What is not a disadvantage of traditional file processing system?

a) Program-data dependence b) Reduce data redundancy c) Limited data sharing d)

Lengthy development time e)none

vii) An enterprise data model is a (n) _______ model.

a) numerical b) mathematical c) narrative d) graphical e)none

viii) Which is not a component of relational database?

a) Entity b) Table c) Attribute d)hierarchy e) none

ix) Data base application can be divided into 5 categories. which is NOT a database
application category?
a) Personal b) Department c) Enterprise d) Relational e) none

x) A data base that supports organization wide operations and decision making is a (n)
________ database.

a) department b) enterprise c) work group d) extra-net e) none

xi) As small companies begin to achieve success, they ten to adopt some of the tools used
in professionally run marketing commas. This is a sign that the firm is in the ________
stage of marketing practice.

a) Entrepreneurial marketing b) formulated marketing c) intrapreneurial marketing d)

effective marketing e) none

xii)The concept of a _______ is used to describe a cluster of complementary products that

are closely related in the minds of the consumers but are spread across a diverse set of
industries.

a) Metamarket b)Metamediary c) Market place d) Marketspace e) none

xiii) Marketers can increase the value of customers offering by:

a) raising benefits and reducing cost

b) raising benefits by more than raising the cost
c) lowering benefits by less than the reduction in cost
d) All of the above can increase the customers value

xiv) When a firm sees its competitors as all companies that compete for the same consumer
dollars, they are concerned with the ________ level of competition.

a) brand b) industry c) form d) generic e) none

xv) The number of channel levels from raw material to final product which a company will
participate defines the firm's _________ scope.

a) industry b) geographical c) vertical d) competence e) none

xvi) Which of the following best describes the organizational members who integrate and
coordinate the work of others?

a) Managers b) Operatives c) Subordinates d) Customers e) all of these

xvii)_________ represent the lowest level of management

a) Team leaders b) First line managers c) Operatives d) Laborers e) none

xviii) Which of the following roles is more important for lower-level managers than for either
middle or top-level managers?

a) Negotiator b) Leader c) Coordinator d) Entrepreneur e)none

xix) Which of the following skills involve working well with other people?

a) Technical b) Human c) Computer d) Empirical e) none

xx) The phrase most associated with scientific management is ________?

a)Management Relations b) one of the best c) supply and demand d) quality control e)
none