Here is a selection of the test questions published by Biz/ed, “a web site for students
and educators in business studies, economics, accounting, leisure, sport & recreation
and travel & tourism.”
Source: http://www.bized.co.uk/learn/business/qbank
“Question Bank - Business Studies
Accounting and Finance: Test
Q1. All of the following are examples of current assets except
(Select one answer)
(a) stocks of raw materials.
(b) unpaid bills.
(c) customers who have not paid their bills yet.
(d) money in a current account.
Q2. In the context of accounting, liabilities are
(Select one answer)
(a) things that you have to put up with.
(b) items of money owed to a business.
(c) a firms debts.
(d) people who do not work efficiently.
Q3. All of the following are examples of fixed assets except
(Select one answer)
(a) a firms buildings.
(b) a firms stock of fuel oil and lubricants.
(c) a firms motor vehicles.
(d) a firms computer equipment.
Q4. A firm may raise money internally or externally. All of the following are internal
sources, except
(Select one answer)
(a) retaining profits within a business rather than paying them out as dividends.
(b) selling assets that are not needed any more.
(c) reducing the working capital requirements.
(d) organising and using an overdraft.
Q5. All of the following are examples of short-term liabilities except
(Select one answer)
(a) debentures with a repayment date in 2 years time.
(b) unpaid VAT.
(c) declared but unpaid dividends.
(d) overdrafts.
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Q6. All the following are examples of fixed costs, except
(Select one answer)
(a) insurance fees.
(b) rent payments.
(c) directors fees.
(d) licence fee on a product sold.
Q7. All the following are fixed costs, except
(Select one answer)
(a) a salary.
(b) a wage.
(c) a commission payment.
(d) a weekly retainer.
Q8. A Cash Cow is
(Select one answer)
(a) a product which generates a significant amount of profit for a company.
(b) a product with a high market share, and a high rate of growth.
(c) a product with a low market share and a low rate of growth.
(d) a product which generates a significant amount of money for a company
Q9. Market share tells you
(Select one answer)
(a) how well a firm is doing.
(b) how much power a firm has in a market.
(c) how many firms there are in a particular market.
(d) how big a market is.
Q10. Market share can be measured by
(Select one answer)
(a) counting the number of customers there are in a market, and for a particular firm
within it.
(b) comparing the sales value for a company with the total unit sales for the whole
market.
(c) comparing the sales value for a company with the total sales value for the whole
market.
(d) comparing the number of outlets a firm has with the total number of outlets within the
market
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Q11. When looking at a firms marketing strategy you notice the term 'asset-led'
marketing. What does this mean?
(Select one answer)
(a) The selling of those fixed assets which are no longer needed to maintain current
capacity needs.
(b) The use of names to sell products.
(c) The use by a company of its assets as a major part of its marketing strategy.
(d) The process of buying a company and then selling some of its most valued assets.
Q12. Which of the following is an example of a loss leader?
(Select one answer)
(a) The use of advertising via newspapers and television.
(b) Engaging a public relations firm to promote your company.
(c) Using very low prices to encourage customers to buy.
(d) An advertising campaign that aims to increase public awareness of your product.
Q13. All of the following are justifications for holding large stocks of raw materials,
except
(Select one answer)
(a) the seasonal supply of materials such as coffee beans or even garden peas.
(b) in anticipation of a future shortage and rapid rise in price.
(c) large quantities are available on the market.
(d) to take advantage of significant bulk buying reductions.
Q14. When a firm in the secondary sector of the economy takes over a related business in
the tertiary sector, this is an example of
(Select one answer)
(a) horizontal integration.
(b) backward integration.
(c) Forward vertical integration.
(d) Forward horizontal integration
Q15. A bank takes over a fishing company, a steel works, a vegetable processing firm
and an airline. This is an example of
(Select one answer)
(a) forward integration
(b) a firm becoming a conglomerate.
(c) horizontal integration.
(d) company mergers.
Q16. What is meant by the term 'management by objectives'?
(Select one answer)
(a) A system of giving the authority to carry out certain jobs by those lower down the
management hierarchy.
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(b) The system of management that is based on bringing together experts into a team.
(c) The setting of objectives to bring about the achievement of the corporate goals.
(d) The control of the organisation by those in the 'head office'.
Q17. What is meant by the term functional management?
(Select one answer)
(a) A system of business organisation that is based on an individual having a wide range
of skills needed to administer a business..
(b) A type of management that is based more on personality.
(c) A system that groups together various jobs and is organised by departments, sections
or functions.
(d) A system that supports a flat form of command chain.
Q18. What is meant by the term delegation?
(Select one answer)
(a) A system of management that relies on consulting employees before making
decisions.
(b) The process of using goals as the best way of motivating managers to achieve
corporate targets/objectives.
(c) The giving of tasks by a manager to a subordinate.
(d) A style of management supported by FW Taylor.
Q19. An increase in the rate of interest may reduce the profits of a company because
(Select one answer)
(a) the customers will have more money to spend.
(b) exports will become easier and cheaper.
(c) costs will increase since overdrafts and loans will be more expensive.
(d) it will become more rewarding to invest in new products and projects
Q20. All of the following are examples of external stakeholders of a company except
(Select one answer)
(a) shareholders.
(b) suppliers.
(c) customers.
(d) local government.
Q21. Which of the following is an accurate definition of interest rates?
(Select one answer)
(a) The cost of borrowing money.
(b) The price of one currency expressed in terms of another.
(c) The level of unemployment that is normally apparent in an economy as some people
are in between jobs or searching for a new one.
(d) The setting of the exchange rate by the forces of the market for currency.”
Source: http://www.bized.co.uk/learn/business/qbank
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