MGT201 Quize # 02

The time period between ordering and receiving inventory order is known as:
MGT201
Option 1: Over time
Option 2: Carrying time
Option 3: Lead time
Option 4: All of the given options

Assume, ABC Company was following conservative working capital policy and now
it wants to move to an aggressive policy. As a result of this shift in policy, the
company should expect which of the following? MGT201
Option 1: Decrease in liquidity, while expected profitability will increase
Option 2: Both risk and liquidity will increase
Option 3: Expected profitability will increase, while risk will decrease
Option 4: Both risk and profitability will decrease

Which of the following statement is true in regards to “2/15 net 30”? MGT201
Option 1: A 15% discount will be given if payment is made within 15 days
Option 2: A 15% discount will be given if payment is made within 30 days
Option 3: A 2% discount will be given if payment is made within 30 days
Option 4: A 2% discount will be given if payment is made within 15 days

Which of the following is/are the component(s) of return? MGT201

Option 1: Additional amount on investment
Option 2: All of above given options
Option 3: Dividend
Option 4: Interest
Coefficient of variation is a measure of relative dispersion (risk) per unit of:
MGT201
Option 1: Expected volatility
Option 2: Expected return
Option 3: Expected risk
Option 4: All of the above given options

Which of the following is correct formula for per-unit contribution margin?

MGT201
Option 1: Sales / Contribution margin per unit
Option 2: Sales per unit - Variable cost per unit
Option 3: Fixed cost / Contribution margin per unit
Option 4: Total contribution margin/ Sales

Which of the following statement is TRUE, if contribution margin is positive?

MGT201
Option 1: Loss will occur if the contribution margin is higher than fixed expenses
Option 2: Profit will only occur if the contribution margin is less than the fixed expenses
Option 3: Both profit and loss can occur
Option 4: Profit will occur

If the trade discount of “2/10 net 30” is missed, then the rational manager should
make the payment at which point of time? MGT201
Option 1: Should delay the payment even after the final due date
Option 2: On the final due date
Option 3: None of the given option
Option 4: As soon as possible
The variability in portfolio returns that can be avoided through diversification is
termed as: MGT201
Option 1: Coefficient of variation
Option 2: Standard deviation
Option 3: Unsystematic risk
Option 4: systematic risk

Which of the following is/are types of inventory? MGT201

Option 1: All of the given options
Option 2: Work in process
Option 3: Finished Goods
Option 4: Raw Material