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CAIIB practice Questions for ABM Free e-book

CAIIB Practice Questions For ABM

A car costing Rs. 700000/- was purchased with a vehicle loan to be used as a Taxi. It's
estimated salvage value is Rs. 50000/- at the end of 6 years. The depreciation under WDV
method is 35.58%

Q1. What will be the amount of depreciation on the car for the 2nd year under the straight-
line method?
a. 103358
b. 187137
c. 216666
d. 579446

Q2. What will be the amount of depreciation for the 3rd under WDV method?
a. 103358
b. 187137
c. 216666
d. 579446

Q3. What will be the accumulated depreciation till the 4th year under WDV method?
a. 103358
b. 187137
c. 216666
d. 579446

Q4. What will be the WDV at the end of 3rd year?

a. 103358
b. 187137
c. 216666
d. 579446

Q5. The term GNP incorporates economic activity_______.

a. taking place within the geographical boundary of the country
b. of the nationals of the country and their property
c. of the nationals of the country and their property plus incomes earned by non- nationals
working within the country
d. taking place within the geographical boundary of the country minus incomes earned by
non-nationals working within the country

Q6. The process of identifying human resource needs and formulating plans to meet these
needs is ______
a. HR Planning
b. Manpower planning
c. IT Planning
d. Production planning
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Q7. Following cost data is given about ABC Company's product

1. Selling price per unit - Rs. 200
2. Marginal cost per unit - Rs. 150
3. Fixed cost per annum - Rs. 1,00,000

Q8. Calculate the following

1. P/V Ratio
a. 20 percent
b. 23 percent
c. 25 percent
d. 28 percent

Q9. Break even sales

a. 2,00,000 OR 1000 units
b. 3,00,000 OR 1500 units
c. 4,00,000 OR 2000 units
d. 5,00,000 OR 2500 units

Q10. Sales to earn a profit of Rs. 25,000

a. 2,00,000 OR 1000 units
b. 3,00,000 OR 1500 units
c. 4,00,000 OR 2000 units
d. 5,00,000 OR 2500 units

Q11. Profit at sales of Rs. 8,00,000

a. 1,00,000
b. 2,50,000
c. 6,00,000
d. 8,50,340

Q12.New break even sales, if price is increased by 25%

a. 1,00,000
b. 2,50,000
c. 6,00,000
d. 8,50,340
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Q13.New break even sales, if price is reduced by 15%

a. 1,00,000
b. 2,50,000
c. 6,00,000
d. 8,50,340

Q14. consideration must be balanced against ......

a. Facilities and obtainability
b. Talents and skills of the people
c. Abilities and availability of the people
d. None of the above

Q15. 'Differentiation and integration' is an example of ......

a. human process intervention
b. techno structural interventions
c. strategic intervention
d. HRM interventions

Q16. Stage in which a person focuses on maintaining an established position is called ......
a. exploration stage
b. growth stage
c. mid career crisis sub stage
d. maintenance stage

Q17. People having 'foreign services' as a profession are best classified as ......
a. realistic orientation
b. investigative orientation
c. social orientation
d. artistic orientation

Q18. Which of the following statements is not true with respect to the matching strategy?
a. All assets should be financed with permanent long term capital
b. Temporary current assets should be financed with temporary working capital
c. Permanent current assets should be financed with permanent working capitals
d. Long term assets should be financed from long term capital

Q19. Which of the following working capital strategies is the most aggressive?
a. Making greater use of short term finance and maximizing net short term asset
b. Making greater use of long term finance and minimizing net short term asset
c. Making greater use of short term finance and minimizing net short term asset
d. Making greater use of long term finance and maximizing net short term asset

Q20. In the terminology of economics and money demand, the terms M3 and M4 are also
known as ......
a. Short money
b. Long money
c. Broad money
d. Narrow money
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Q21. Net working capital refers to ......

a. total assets minus fixed assets
b. current assets minus current liabilities
c. current assets minus inventories
d. current assets

Q22. Companies may adopt an aggressive or a conservative working capital policy. An

aggressive policy means that a company ......
a. faces a low level of risk
b. expects a lower level of profitability
c. holds high levels of cash and inventories
d. has a low level of flexibility

Q23. Risk, as it relates to working capital, means that there is jeopardy to the firm for not
maintaining sufficient current assets to ......
a. meet its cash obligations as they occur and take advantage of prompt payment discounts
b. support the proper level of sales and take prompt payment discounts
c. maintain current and acid-test ratios at or above industry norms
d. meet its cash obligations as they occur and support the proper level of sales

Q24. Which of the following statements is correct for an aggressive financing policy for a firm
relative to a former conservative policy?
a. The firm will use long-term financing to finance all fixed and current assets
b. The firm will see an increase in its expected profits
c. The firm will see a decline in its risk profile
d. The firm will need to issue additional common stock this period to finance the assets

Q25. Outcomes of competency based pay systems such as fewer bottlenecks, more
workforce flexibility and increased effectiveness are classified as ......
a. quartile strategy based outcome
b. organization-related outcomes
c. employee-related outcomes
d. percentiles strategy outcomes

Q26. Macroeconomics is a study of economics that deals with 4 major factors ......
a. households, firms, government, and demand-supply
b. households, firms, government and external sector
c. firms, government, free-market, and regulations
d. none of the above

Q27. An increase in taxes is a(n) ......

a. expansionary fiscal policy
b. expansionary monetary policy
c. contractionary fiscal policy
d. contractionary monetary policy

Q28. A boom is a series of ......

a. increasing deviations from trend
b. peaks
c. above trend values
d. positive growth rates
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Q29. Income Elasticity established relation between Income and ......

a. Price
b. Supply
c. Quantity Demanded
d. Income

Q30. Who gave the welfare theory of economics?

a. Alfred Marshall
b. Lionel Robbins
c. Adam Smith
d. None of these

Q31. Forces behind the demand curve ......

a. Expectation about future economic conditions
b. Average Income
c. Cost of production
d. Both a and b

Q32. Which of the following is consistent with the law of supply?

a. As the price rises, the quantity supplied also increases
b. As the price falls, the supply increases
c. As the price rises, the quantity supplied decreases.
d. None

Q33. Risk, as it relates to working capital, means that there is jeopardy to the firm for not
maintaining
sufficient current assets to ......
a. meet its cash obligations as they occur and take advantage of prompt payment discounts
b. support the proper level of sales and take prompt payment discounts
c. maintain current and acid-test ratios at or above industry norms
d. meet its cash obligations as they occur and support the proper level of sales
Which of the following statements is correct for an aggressive financing policy for a firm
relative to a

Q34. former conservative policy?

a. The firm will use long-term financing to finance all fixed and current assets
b. The firm will see an increase in its expected profits
c. The firm will see a decline in its risk profile
d. The firm will need to issue additional common stock this period to finance the assets

Q35. Outcomes of competency based pay system such as fewer bottlenecks, more
workforce flexibility and
increased effectiveness are classified as ......
a. quartile strategy based outcome
b. organization-related outcomes
c. employee-related outcomes
d. percentiles strategy outcomes
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Q36. An Inquiry into the Nature and Causes of Wealth of Nations” is the book of economist
......
a. Adam Smith
b. Marshall
c. Robbins
d. None of above

Q37. Macroeconomics is a study of economics that deals with 4 major factors ......
a. households, firms, government, and demand-supply
b. households, firms, government and external sector
c. firms, government, free-market, and regulations
d. none of the above

Q38. An increase in taxes is a(n) ......

a. expansionary fiscal policy
b. expansionary monetary policy
c. contractionary fiscal policy
d. contractionary monetary policy

Q39. A boom is a series of ......

a. increasing deviations from trend
b. peaks
c. above trend values
d. positive growth rates

Q40. Income Elasticity established relation between Income and ......

a. Price
b. Supply
c. Quantity Demanded
d. Income

Q41. Who gave the welfare theory of economics?

a. Alfred Marshall
b. Lionel Robbins
c. Adam Smith
d. None of these

Q42. Forces behind the demand curve ......

a. Expectation about future economic conditions
b. Average Income
c. Cost of production
d. Both a and b

Q43. Which of the following is consistent with the law of supply?

a. As the price rises, the quantity supplied also increases
b. As the price falls, the supply increases
c. As the price rises, the quantity supplied decreases.
d. None
CAIIB practice Questions for ABM Free e-book

Q44. Whenever the government spends more than it collects through revenue, the resulting
imbalance is
known as ......
a. Public deficit
b. Market deficit
c. Government deficit
d. Budget deficit

Q45. Which of the following does not occur during an expansion?

a. Consumer purchases increase
b. Demand for labor rises
c. Business profits increase
d. None of the above

Q46. According to Marshall, the basis of consumer surplus is ......

a. Law of diminishing marginal utility
b. Law of equi-marginal utility
c. Law of proportions
d. All of the above

Q47. By increasing the 'Bank Rate', the RBI can ......

a. provide incentives to commercial banks to lend more to public
b. provide incentives to commercial banks to lend less to public
c. increase the money supply in the market
d. none of the above

Q48. Method of predicting organisation future demand for employees ......

a. HR Forecast
b. Labour Forecast
c. Manpower Forecast
d. Job Forecast

Q49. A lateral movement within the same grade from one job to another
a. Promotion
b. Transfer
c. Recruitment
d. Retrenchment

Q50. Your firm has a philosophy that is analogous to the hedging (maturity matching)
approach. Which of the Following is the most appropriate form for financing a new capital
investment in plant and equipment?
a. Trade credit
b. 6-month bank notes
c. Accounts payable
d. Common stock equity