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UPDATED MBA ETS MAJOR FIELD
TEST QUESTIONS WITH CORRECT
ANSWERS ALREADY PASSED AND
VERIFIED
Question (1): Which of the following organizations is
most likely to use project financing?
CORRECT ANSWER : (D) A large public utility
involved in infrastructure development
Question (2): 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?
CORRECT ANSWER : (A) The training process to
prepare the new hires for their assigned tasks was inadequate.
Question (3): 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
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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?
CORRECT ANSWER : (C) It would increase by $3.00
per unit sold.
Question (4): 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?
CORRECT ANSWER : (A) They have good cash flows.
Question (5): 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?
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CORRECT ANSWER : (B) Management is sending a
signal that the company has good projected future earnings.
Question (6): 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?
CORRECT ANSWER : (A) What are the company’s
core competencies?
Question (7): 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
CORRECT ANSWER : (D) $24
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Question (8): Increased globalization and technological
change, particularly in telecommunications, enable more organizations to adopt which of the following organizational structures?
CORRECT ANSWER : (C) Network
Question (9): A new local Super Store publicly
announced that when more than three people are standing in line at cash registers, additional checkout-lines will be opened. After the announcement, customers quickly noticed that the additional lines were not opened until six or seven people were standing in line. This indicates a gap between
CORRECT ANSWER : (A) Customer expectation and
management perception of customer expectation
Question (10): All of the following can be considered in
the evaluation of a business unit EXCEPT
CORRECT ANSWER : (B) Projected annual revenues of
competitors
