Human Resource Management (HRM) MCQS

Multiple choice Questions on Human Resource Management. Practice for fpsc ppsc exams

One limitation of the ____________ is that it is based on historical costs.

A. Income statement
B. Statement of cash flows
C. Balance sheet
D. Budget
Correct answer is: C. Balance sheet

The concept that represents what you give up as a result of making an alternative decision is called:

A. Purchase price
B. Financing cost
C. Opportunity cost
D. Liquidity need
Correct answer is: C. Opportunity cost

What is the formula for the payback period?

A. Initial investment / Annual cash inflow
B. Net income / Investment
C. Cash inflow / Debt
D. Investment / Net profit
Correct answer is: A. Initial investment / Annual cash inflow

What is the formula for earnings per share (EPS)?

A. Net income / Number of shares outstanding
B. EBIT / Shares
C. Net income / Sales
D. Dividends / Shares
Correct answer is: A. Net income / Number of shares outstanding

Which of the following is NOT a method of capital investment appraisal?

A. Payback
B. Net Book Value
C. Net Present Value (NPV)
D. Internal Rate of Return (IRR)
Correct answer is: B. Net Book Value

____________ is access to funds to cover any short-term cash deficiencies.

A. Liquidity
B. Credit management
C. Money management
D. Cash management
Correct answer is: A. Liquidity

Your ____________ is the value of what you own minus the value of what you owe.

A. Net assets
B. Budget
C. Net liabilities
D. Net worth
Correct answer is: D. Net worth

Which of these is a limitation of the payback period method?

A. Ignores time value of money
B. Hard to calculate
C. Requires complex software
D. Not useful for small projects
Correct answer is: A. Ignores time value of money

Which of these is a motive for holding cash?

A. Transaction motive
B. Precautionary motive
C. Speculative motive
D. All of the above
Correct answer is: D. All of the above

What is the term for the return that is forgone by investing in a project rather than investing in financial markets at the same level of risk?

A. Internal rate of return
B. Capital saving
C. Opportunity cost
D. Opportunity saving
Correct answer is: C. Opportunity cost
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