MGRADES
MBA assessment UPDATED ACTUAL
Exam Questions and CORRECT 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 ANSWER - 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 - CORRECT ANSWER - 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. - CORRECT ANSWER - 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.
, MGRADES
(D) They issue warrants to their officers. - CORRECT ANSWER - 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. -
CORRECT ANSWER - 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?
(D) Does the company have e-commerce capabilities? - CORRECT ANSWER - A) what are the
company's core competencies?
If you were the holder of a call option (having cost you $2) on some stock with an exercise price of $20, it
would be best for you to exercise your option when the market price is at
(A) $18 .
(B) $20
.(C) $22
(D) $24 - CORRECT ANSWER - (D) $24
Increased globalization and technological change, particularly in telecommunications, enable more
organizations to adopt which of the following organizational structures?
(A) Functional
(B) Matrix
(C) Network
MBA assessment UPDATED ACTUAL
Exam Questions and CORRECT 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 ANSWER - 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 - CORRECT ANSWER - 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. - CORRECT ANSWER - 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.
, MGRADES
(D) They issue warrants to their officers. - CORRECT ANSWER - 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. -
CORRECT ANSWER - 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?
(D) Does the company have e-commerce capabilities? - CORRECT ANSWER - A) what are the
company's core competencies?
If you were the holder of a call option (having cost you $2) on some stock with an exercise price of $20, it
would be best for you to exercise your option when the market price is at
(A) $18 .
(B) $20
.(C) $22
(D) $24 - CORRECT ANSWER - (D) $24
Increased globalization and technological change, particularly in telecommunications, enable more
organizations to adopt which of the following organizational structures?
(A) Functional
(B) Matrix
(C) Network
