ETS MAJOR FIELD TEST MBA
QUESTIONS AND ANSWERS
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 - Correct Answers -D. A
large public utility involved in infrastructure development
Which of the following should be reported net of tax on a corporation's income
statement?
A. Discounted operations
B. Operating income
C. Gross Profit
D. Gain on sale of delivery truck - Correct Answers -A. Discounted operations
If a multinational co cannot change the level of political rsk in foreign markets which of
the following tactics would most likely offset possible losses?
A. Maintain control of distribution
B. Use currency futures contracts
C. Finance debt locally
D Maintain control of key inputs - Correct Answers -C. Finance debt locally
Blessed Bundles is a regional clicks-and mortar retail chain that sells maternity and
baby products. It uses data from past purchases to study customers' product
preferences, and it uses server tracking logs to study customers' product preferences,
and it uses server tracking logs to study customer' online shoppingbehavior. Which of
the following correctly describes the two types of market research data the co is using?
Past Purchases SErver TRackingLogs
A Transactional Clickstream
B. Clcikstream Transactional
C. Private Public
D. Public Private - Correct Answers -A
, 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 hire was not competitive with that of the rest of the
industry.
D. The new hires lacked the basic skills required to learn the job. - Correct Answers -A.
The training process to prepare the new hires for their assigned tasks was 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 goods 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 cost unit of $2.00. If presco 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 decrease by $3.00 per unit sold
D. It would decrease by $5.00 per unit sold - Correct Answers -C. It would decrease 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. - Correct Answers -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 if 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 earnings.
C. While the company was able to pay a higher dividend, management preferred a
more conservative figure.
QUESTIONS AND ANSWERS
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 - Correct Answers -D. A
large public utility involved in infrastructure development
Which of the following should be reported net of tax on a corporation's income
statement?
A. Discounted operations
B. Operating income
C. Gross Profit
D. Gain on sale of delivery truck - Correct Answers -A. Discounted operations
If a multinational co cannot change the level of political rsk in foreign markets which of
the following tactics would most likely offset possible losses?
A. Maintain control of distribution
B. Use currency futures contracts
C. Finance debt locally
D Maintain control of key inputs - Correct Answers -C. Finance debt locally
Blessed Bundles is a regional clicks-and mortar retail chain that sells maternity and
baby products. It uses data from past purchases to study customers' product
preferences, and it uses server tracking logs to study customers' product preferences,
and it uses server tracking logs to study customer' online shoppingbehavior. Which of
the following correctly describes the two types of market research data the co is using?
Past Purchases SErver TRackingLogs
A Transactional Clickstream
B. Clcikstream Transactional
C. Private Public
D. Public Private - Correct Answers -A
, 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 hire was not competitive with that of the rest of the
industry.
D. The new hires lacked the basic skills required to learn the job. - Correct Answers -A.
The training process to prepare the new hires for their assigned tasks was 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 goods 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 cost unit of $2.00. If presco 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 decrease by $3.00 per unit sold
D. It would decrease by $5.00 per unit sold - Correct Answers -C. It would decrease 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. - Correct Answers -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 if 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 earnings.
C. While the company was able to pay a higher dividend, management preferred a
more conservative figure.
