MBA ASSESSMENT GUIDE
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which of the following organizations is most likely to use project financing?
a) a small start-up
b) a financial services firm with an extensive client list
c) a large consumer goods company
d)a large public utility involved in infrastructure development - ANS-d) a large public
utility involved in infrastructure development
After an extensive recruitment process to select well-qualified individuals, a large
percent of a company's new hires resigned within the first month of the job. Which of
the following is the most likely explanation for this situation.
a) the training process to prepare the new hires for their assigned tasks was
inadequate
b) the health benefits provided by the company were not competitive with those of the
rest of the industry
c) the starting salary for the new hires was not competitive with that of the rest of the
industry
d) the new hires lacked the basic skills required to learn the job - ANS-a) the training
process to prepare the new hires for their assigned tasks with inadequate
Prosco Ltd. employs a process cost system. Inspection of units occurs at the 50 percent
mark. Defective units are then removed from the process, and their cost ($4.50) is
absorbed by the good units. Prosco has recently been approached by a firm wishing to
buy the defective units for a special use. The firm would require Prosco to modify the
defective units at a unit cost of $2.00. If Prosco sells the defective units to the firm for
$5.00 each, how would Prosco's reported income be affected?
, (A) It would decrease by $4.50 per unit sold.
(B) It would decrease by $1.50 per unit sold.
(C) It would increase by $3.00 per unit sold.
(D) It would increase by $5.00 per unit sold. - ANS-c) it would increase by $3.00 per
unit sold
Some companies have little, if any, net income or earnings, yet they seem to have all
the money they need for capital expenditures. Which of the following best explains
how such companies operate?
(A) They have good cash flows. (B) They lease capital equipment that does not show
up on balance sheets.
(C) They have accounts with many different banks.
(D) They issue warrants to their officers. - ANS-A) they have good cash flows
The Sintar Corporation has just announced that it will pay $1.10 per share in dividends
to its stockholders in the current quarter. The prior quarter's dividend was $1.00 per
share. The announcement indicates which of the following?
(A) Management is sending a signal that it expects the economy to expand.
(B) Management is sending a signal that the company has good projected future
earnings.
(C) While the company was able to pay a higher dividend, management preferred a
more conservative figure.
(D) The company has overextended its cash position and may have liquidity problems
in the future. - ANS-B) management is sending a signal that the company has good
projected future earnings
Wave Inc. is a telecommunications company that wants to become involved in e-
commerce. It has to decide whether to develop a business-to-business or business-to-
consumer strategy. As Wave's strategic planner, you have been asked to develop a
business plan for each opportunity and present these to senior management. The
answer to which of the following questions is most important to know before starting
your plan?
(A) What are the company's core competencies?
(B) What is the potential market size?
(C) What is the impact on the estimated revenue?
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which of the following organizations is most likely to use project financing?
a) a small start-up
b) a financial services firm with an extensive client list
c) a large consumer goods company
d)a large public utility involved in infrastructure development - ANS-d) a large public
utility involved in infrastructure development
After an extensive recruitment process to select well-qualified individuals, a large
percent of a company's new hires resigned within the first month of the job. Which of
the following is the most likely explanation for this situation.
a) the training process to prepare the new hires for their assigned tasks was
inadequate
b) the health benefits provided by the company were not competitive with those of the
rest of the industry
c) the starting salary for the new hires was not competitive with that of the rest of the
industry
d) the new hires lacked the basic skills required to learn the job - ANS-a) the training
process to prepare the new hires for their assigned tasks with inadequate
Prosco Ltd. employs a process cost system. Inspection of units occurs at the 50 percent
mark. Defective units are then removed from the process, and their cost ($4.50) is
absorbed by the good units. Prosco has recently been approached by a firm wishing to
buy the defective units for a special use. The firm would require Prosco to modify the
defective units at a unit cost of $2.00. If Prosco sells the defective units to the firm for
$5.00 each, how would Prosco's reported income be affected?
, (A) It would decrease by $4.50 per unit sold.
(B) It would decrease by $1.50 per unit sold.
(C) It would increase by $3.00 per unit sold.
(D) It would increase by $5.00 per unit sold. - ANS-c) it would increase by $3.00 per
unit sold
Some companies have little, if any, net income or earnings, yet they seem to have all
the money they need for capital expenditures. Which of the following best explains
how such companies operate?
(A) They have good cash flows. (B) They lease capital equipment that does not show
up on balance sheets.
(C) They have accounts with many different banks.
(D) They issue warrants to their officers. - ANS-A) they have good cash flows
The Sintar Corporation has just announced that it will pay $1.10 per share in dividends
to its stockholders in the current quarter. The prior quarter's dividend was $1.00 per
share. The announcement indicates which of the following?
(A) Management is sending a signal that it expects the economy to expand.
(B) Management is sending a signal that the company has good projected future
earnings.
(C) While the company was able to pay a higher dividend, management preferred a
more conservative figure.
(D) The company has overextended its cash position and may have liquidity problems
in the future. - ANS-B) management is sending a signal that the company has good
projected future earnings
Wave Inc. is a telecommunications company that wants to become involved in e-
commerce. It has to decide whether to develop a business-to-business or business-to-
consumer strategy. As Wave's strategic planner, you have been asked to develop a
business plan for each opportunity and present these to senior management. The
answer to which of the following questions is most important to know before starting
your plan?
(A) What are the company's core competencies?
(B) What is the potential market size?
(C) What is the impact on the estimated revenue?
