AS 03 Finance & Economics for Actuarial Mock Test 10

1. In the GDP Expenditure Approach, what does 'C' represent?

A. Capital expenditure
B. Corporate spending
C. Consumption – Personal Consumption Expenditures
D. Currency reserves
E. Central bank lending

2. Which of the following items is kept OUTSIDE the purview of GST?

A. Textiles
B. Electronics
C. Medicines
D. Alcohol for human consumption, Petroleum products, Electricity, Property taxes, Motor Vehicles Tax, Entertainment Tax collected by local bodies
E. Automobiles

3. What was the problem of 'Lack of cross-utilisation facility between goods and services' before GST?

A. Companies could not claim input tax credit at all
B. Tax paid on procurement of purchases was not allowed to be set off against output tax payable on services and vice versa
C. Companies had to pay double the tax on all transactions
D. Only large companies faced this problem
E. This problem only affected importers

4. According to Chapter 9's practice questions, a capital budgeting method that takes into consideration the time value of money is the:

A. Annual Rate of Return method
B. Return on Shareholders' Equity method
C. Internal Rate of Return method
D. Cash Payback technique
E. Payback Period method

5. What is a Prospectus?

A. A company's annual report to shareholders
B. The audited balance sheet of a company
C. A notice issued by SEBI for regulatory purposes
D. Any document described or issued as a prospectus or any notice, circular, or advertisement inviting offers from the public for subscription or purchase of securities
E. A government notification about company regulations

6. How is a 'Public Company' defined under Section 2(71) of the Companies Act, 2013?

A. A company limited by guarantee only
B. A government-owned enterprise
C. A company that only trades on stock exchanges
D. A company which is not a private company and has a minimum paid-up share capital as may be prescribed
E. A company with more than 500 shareholders

7. What is a Giffen Good?

A. A luxury good bought by wealthy consumers
B. A good with perfectly elastic demand
C. A good that people buy more of as their incomes fall, has a vertical demand curve, and is another name for a free good
D. A government-provided public good
E. A good that can substitute any other good

8. What is the main difference between Nominal GDP and Real GDP?

A. Nominal GDP includes only goods; Real GDP includes only services
B. Nominal GDP is adjusted for inflation; Real GDP is not
C. Real GDP is adjusted for inflation; Nominal GDP is not
D. Nominal GDP measures foreign investment; Real GDP measures domestic output
E. Real GDP excludes government spending; Nominal GDP includes it

9. The price of apples falls by 5% and quantity demanded increases by 6%. Demand for apples is:

A. Inelastic
B. Perfectly inelastic
C. Elastic
D. Perfectly elastic
E. Unit elastic

10. What are Non-Convertible Debentures (NCDs)?

A. Debentures which cannot be converted into equity shares or preference shares—they are generally redeemable on maturity
B. Debentures that have special conversion features
C. Debentures that convert to preference shares
D. Debentures that carry extra voting rights
E. Debentures issued only by government enterprises