Question 1

The rate of return required undertaking a project; the cost of capital accounts for both the time value of money and risk refers to:

Options :

A : Cost of return

B : Cost of capital

C : Cost of risk

D : Cost of revenue

Answer: B

Question 2

The future value formula to compound at intervals more frequent than annual is:

Options :

A : FV = PV + (1 + i/m) n*m

B : FV = PV * (1 + i/m) n-m

C : FV = PV - (1 + i*m) n/m

D :

FV = PV * (1 + i/m) n*m

(Where i= annual interest rate, m=number of times /year that compounding occurs and n= number

of years)

Answer: D

Question 3

A health care organization that utilizes an aggressive asset mix strategy seeks to minimize its returns

by investing in non-liquid assets but faces the risk of lower liquidity.

Options :

A : True

B : False

Answer: B

Question 4

Under accrual basis of accounting, revenues are recognized when earned.

Options :

A : True

B : False

Answer: A

Question 5

The point where total revenues equal total costs is called:

Options :

A : Cope point

B : Break-even point

C : Get-by point

D : Equivalent point

Answer: B