Business Finance Test Q4

Republic of the Philippines
Department of Education
FOURTH QUARTER TEST
Business Finance – Grade 12
2nd Semester, Finals
Multiple Choice
Direction: Read each item carefully and write only the letter of the correct answer on the blank
provided before
the number.
_____1. What is asset acquired with the goal of generating income of appreciation?
A. Current asset B. Fixed asset C. Investment D. Real estate
_____2. It involves the purchase, ownership, management, rental and/or sale of real estate for
profit.
A. Commodities investing B. Fixed asset investing
C. Insurance investing D. Real estate investing
_____3. One of the disadvantages of this type of investment is that it is volatile and trades 24-
hours a day.
A. Commodities B. Currencies C. Digital currencies D. Real estate
_____4. What are the two types of alternative fixed income and equities?
A. Bonds & Trust Fund B. Mutual Fund and
Cryptocurrencies
C. Mutual Fund and UITF D. Mutual Funds & Bonds
_____5. It is the type of investment where there are no shareholder rights such as right to
dividend and right
to vote.
A. Insurance B. Mutual Fund C. Real Estate D. Trust Fund
_____6. These are the three most commonly traded commodities.
A. Gold, silver, oil B. Nickel, gold, silver
C. Oil, copper, gold D. Oil, gold, base metal
_____7. The following are investment assets EXCEPT:
A. Accounts payable B. Currencies C. Insurance D. Real estate
_____8. Jyx owns a house and lot in a small town. She had it rented by her friend for her to
generate
income. Which investment asset is being describe by the statement?
A. Commodities B. Digital currency C. Insurance D. Real estate
investment
_____9. Xyd work in an investment company. His earning is in dollars considering that his
employer came
from other country. Based on the given statement, which type of investment is evident?
A. Commodity B. Currency C. Cyptocurrency D. Insurance
_____10. There are facts about insurance policies. Which among the given statement doesn’t
show its facts?
A. Insurance premiums are always reasonable.
B. Insurance policies are used to hedge against the risk of financial losses.
C. Some insurance providers provide VUL (Vulnerable Universal Life Insurance) to their
clients.
D. Policy holders are paying an amount in regular basis to insurance company in return
for the
insurance/protection provided.
_____11. Eli buys shares in a particular company. He is just holding it for future use. Which type
of
investment is being described by the statement?
A. Alternative investment B. Currency investment
C. Equity investment D. Investment asset
_____12. What is your analysis of the following statements?
Statement No. 1: Commodities investment is a natural hedge against inflation.
Statement No. 2: Real estate development includes improvement of real property.
A. Only Statement No. 1 is true B. Both Statements are true
C. Only statement No. 2 is true D. Both Statements are false
_____13. It is the money that doesn’t have an impact on the financial position once lost on an
investment.
A. Net income B. Net worth C. Risk capital D. Risk
money
_____14. What is the category of investment risk that is associated with the market?
A. Associated risk B. Market risk C. Systematic risk D.
Unsystematic risk
_____15. Which among the ways in minimizing investment risks shows that it is very safe to
invest in an
instrument that is guaranteed by the government?
A. Conducting due diligence
B. Monitoring of investment
C. Diversification of investment portfolio
D. Taking advantage of government guaranteed investment products
_____16. There are facts about investment risks, EXCEPT:
A. Risk is a good thing.
B. The higher the return, the higher will be the risk.
C. The higher risk would translate into higher potential reward.
D. Sometimes greater risk is just greater risk with little potential return.
_____17. Which measures in minimizing investment risk shows that regular reallocation of
resources is
necessary for control purposes?
A. Conducting due diligence B. Monitoring investment
C. Systematic risk D. Both A & C
For items 18 – 22. Answer what is asked by using the following details.
Percentage
XYZ stock 25%
time deposit certificate 25%
Treasury bonds 25%
real estate 25%
_____18. As an investor, how many percent will be deducted from your money if the real estate
fails?
A. 25% B. 50% C. 75% D. 90%
_____19. Which among the ways of minimizing investment risks is manifested in the given
data?
A. Diversification of investment portfolio B. Monitoring of investment
C. Unsystematic risk D. Both A & B
_____20. If the Treasury bonds fail, the loss is limited. Which justification fits this situation?
A. The loss is limited because 25% of the money is invested in other products.
B. The loss is limited because 35% of the money is invested in other products.
C. The loss is limited because 50% of the money is invested in other products.
D. The loss is limited because 75% of the money is invested in other products.
_____21. How will you interpret the data presented?
A. If XYZ company fails, the loss is unlimited.
B. Profit is realized when there will be an increase in the market price of stock.
C. Profit is realized when there will be a decrease in the market time deposit
certificate.
D. If XYZ company fails, the loss is limited due to the 25% of the money is
invested in other
products.
_____22. Why is there a need to understand diversification of investment portfolio?
A. It increases its volatility as movement changes are not expected to happen.
B. Due to its purpose in portfolio risk management.
C. It is essential in reducing any kind of risk.
D. It changes the portfolio’s nature.
_____23. Cef wants to invest in the stock market using his company’s resources. He knows that the
falling price of
stock in the stock market is very rampant that may directly affect his company. Which of the
following gives justice to the stated analogy?
A. Associated risk B. Systematic risk C. Uncertainty D.
Unsystematic risk
_____24. ZK as an investor and also a risk-taker looks for a new venture. Checking out
investment history,
earnings’ growth and management team are his priority in checking before he will invest
in a certain firm. Among the ways of minimizing investment risk, which of the following
describe ZKs’ action?
A. Conducting due diligence
B. Monitoring of investment
C. Diversification of investment portfolio
D. Determination of tolerance to different kinds of risks
_____25. One of the bases of money management philosophies is to create a ____________
plan.
A. Business B. Financial C. Management D. Money
_____26. It is the process of budgeting, saving, investing, spending or otherwise in overseeing
the cash usage
of an individual or group.
A. Asset management B. Devise a budget
C. Financial position D. Money management
_____27. What money management practice shows a financial roadmap that allows anybody to
live within
their means?
A. Create emergency fund B. Devise a budget
C. Monitor credit score D. Reward oneself
_____28. In money management philosophy, which of these include all financial decisions and
activities of
an individual including budgeting, insurance, mortgage planning, savings, and retirement
planning?
A. Finance B. Financial analysis C. Financial planning D. Personal
finance
_____29. Why financial planning is important?
A. Tactical marketing is its main focus.
B. It is the basis for management decision.
C. It is where careful analysis of the market takes place.
D. It allows analysis of financial position and other financial statements.
_____30. Which among the process of financial planning evaluates the financial plan to see if it
effectively
meets individual goals?
A. Data analysis B. Financial plan recommendation
C. Plan implementation D. Plan monitoring
_____31. Knowing how much money was used up on unnecessary things will be significant in
financial
planning. Which of the following best describes the statement?
A. Thinking about the future
B. Preparing a spending plan
C. Significance of controlling expenditures
D. Review expenditures incurred in the past
_____32. Personal planning is one of the management philosophies. Which personal planning
area focuses
on the analysis of protection needed for unforeseen risks?
A. Adequate protection B. Estate planning
C. Financial position D. Investment and accumulation
goals
_____33. Personal finance, as the key factor of money management, is also governed with
principles. Which
principle focuses on discerning what keeps the money flowing in and making sure that an
individual is focused on this effort?
A. Assessing B. Prioritizing C. Restraining D. Both A &
C
_____34. Analyzing personal finance as part of money management philosophy is crucial. These
are
inclusions in considering the individual financial constraints, EXCEPT:
A. Executing a plan
B. Projecting long-term needs
C. Projecting short-term funding needs
D. Analyzing noncurrent financial positions
_____35. Mr. and Mrs. Xy received a huge amount from their parents. Which of the following
should be
considered for their financial planning process?
A. Review expenditures B. Significance of controlling
expenditure
C. Thinking about the future D. Both A & B
_____36. What is your analysis of the following statements?
Statement No. 1: People who set aside time bases to create a money management plan
make them
financially successful.
Statement No. 2: Anybody who is in the workforce for years, or a recent graduate who is
just starting
out, must generate financial goals for security and freedom both now and
for the future.
A. Only Statement No. 1 is true B. Both Statements are true
C. Only statement No. 2 is true D. Both Statements are false
For items 37-38. Refer your answer to the following money management cycle diagram.
_____37. What stage should money management cycle start?

A. Earning B. Investing C. Saving D. Spending
_____38. What is the outcome after deducting the necessary expenditures from the gross
income?
A. Earning B. Investing C. Saving D. Spending
_____39. Which financial phase where retired individuals belong?
A. Consolidation B. Gifting C. Saving D. Spending
_____40. Those individuals who are in this phase already have the necessary assets required of a
typical
household and have settled most of their outstanding liabilities.
A. Consolidation B. Gifting C. Saving D. Spending
_____41. Which part of financial management includes a plan to generate income from
investment?
A. Acquisition of assets B. Creating a budget
C. Investing income D. Planning for retirement
_____42. Which example of money management wherein an individual must set financial
priorities?
A. Assess financial situation B. Create a budget
C. Manage debt D. Plan for retirement
_____43. What is considered as beneficial since this is not subject to probate and this can reduce
estate tax?
A. Dying trust B. Living trust C. Trust fund D. Both A &
C
_____44. A dying philanthropist prepared a will to equally donate his wealth to his chosen
charity institution.
What financial phase do this belong?
A. Accumulating B. Consolidation C. Gifting D. Spending
_____45. Which of the following shows determining one’s net worth?
A. Managing equities B. Managing investment
C. Managing liabilities D. Managing personal finance
_____46. Sell investments, negotiate with a creditor to repay the debt in a payment plan shows
which example
of money management?
A. Investing money B. Managing debt
C. Planning for retirement D. Settling of debts
_____47. Evaluate the following phases where an individual may consider in his life cycle.
Which shows the
chronological order wherein an individual will utilize in their financial objectives?
I. Accumulation
II. Consolidation
III. Gifting
IV. Spending
A. I, II, III & IV B. II, 1, IV & III C. I, II, IV & III D. II, III, I &
IV
_____48. A recently graduated individual immediately started a career as a bank teller in one of
the reputable
banks in the locality. In the first year of employment, this individual was able to buy a
brand new
motorcycle. Which financial phase do this statement described?
A. Accumulation B. Gifting C. Investing D. Spending
Grade 12 BUSINESS FINANCE

4th Quarter
ANSWER KEY
1. C 11. C 21. B 31. C 41. C
2. D 12. B 22. C 32. A 42. B
3. B 13. C 23. D 33. B 43. B
4. C 14. C 24. A 34. D 44. C
5. D 15. D 25. B 35. C 45. D
6. D 16. D 26. D 36. B 46. B
7. A 17. B 27. B 37. A 47. C
8. D 18. A 28. D 38. C 48. B
9. B 19. A 29. D 39. D
10. A 20. D 30. D 40. A
Learning COGNITIVE PROCESS DIMENSION
Competencies
Duration No. of
%
(Hours) Questions Remembering Understanding Applying Analyzing Evaluating Cre
The learners should
be able to…
• compare and
contrast the
1 2 25 12 6 1 1 3 1
different types
of investments
• measure and
list ways to
minimize or
2 reduce 2 25 12 2 3 5 1 1
investment
risks in simple
case problems
3 • enumerate 2 25 12 3 5 2 1 1
money
management
philosophies
4 • illustrate the 2 25 12 7 2 1 2
money
management
cycle and
gives
examples of
sound
practices in
earning,
spending,
saving, and
investing
money
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_____37. What stage should money management cycle start?

Grade 12 BUSINESS FINANCE

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