MFT- MBA PRACTICE QUESTIONS WITH CORRECT DETAILED ANSWERS A+
VERIFIED LATEST VERSION (2026-2027)
1. 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: (D) A large public
utility involved in infrastructure development
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? (
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.: A) The training
process to prepare the new hires for their assigned tasks was inadequate.
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
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.: (C) It would increase by $3.00 per unit sold.
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?
(A) They have good cash flows.
, MFT- MBA PRACTICE QUESTIONS WITH CORRECT DETAILED ANSWERS A+
VERIFIED LATEST VERSION (2026-2027)
(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.: (A) They have good cash flows.
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?
(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.: (B) Management is sending a signal that the company has good projected future
earnings.
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?
(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?: (A) What are the company's core
competencies?
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
(A) $18
(B) $20
, MFT- MBA PRACTICE QUESTIONS WITH CORRECT DETAILED ANSWERS A+
VERIFIED LATEST VERSION (2026-2027)
(C) $22
(D) $24: (D) $24
8. Increased globalization and technological change, particularly in telecom-
munications, enable more organizations to adopt which of the following
organizational structures?
(A) Functional
(B) Matrix
(C) Network
(D) Mechanistic: (C) Network
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
(A) customer expectation and management perception of customer expecta-
tion
(B) management perception of customer expectation and service quality spec-
ifications
(C) customer expectation and internal management communication
(D) actual service delivery and how service quality was communicated: (D) actual
service delivery and how service quality was communicated
10. All of the following can be considered in the evaluation of a business unit
EXCEPT
(A) wages paid to labor
(B) projected annual revenues of competitors
(C) the cost of materials used in the production process
(D) the price at which goods produced are sold: (B) projected annual revenues of competitors
11. The sales division of a corporation is considering an internal product trans-
fer because of excess demand. What is the lowest acceptable transfer price
for the product?
(A) The amount that the company would have to pay to acquire a similar
product
VERIFIED LATEST VERSION (2026-2027)
1. 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: (D) A large public
utility involved in infrastructure development
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? (
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.: A) The training
process to prepare the new hires for their assigned tasks was inadequate.
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
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.: (C) It would increase by $3.00 per unit sold.
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?
(A) They have good cash flows.
, MFT- MBA PRACTICE QUESTIONS WITH CORRECT DETAILED ANSWERS A+
VERIFIED LATEST VERSION (2026-2027)
(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.: (A) They have good cash flows.
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?
(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.: (B) Management is sending a signal that the company has good projected future
earnings.
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?
(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?: (A) What are the company's core
competencies?
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
(A) $18
(B) $20
, MFT- MBA PRACTICE QUESTIONS WITH CORRECT DETAILED ANSWERS A+
VERIFIED LATEST VERSION (2026-2027)
(C) $22
(D) $24: (D) $24
8. Increased globalization and technological change, particularly in telecom-
munications, enable more organizations to adopt which of the following
organizational structures?
(A) Functional
(B) Matrix
(C) Network
(D) Mechanistic: (C) Network
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
(A) customer expectation and management perception of customer expecta-
tion
(B) management perception of customer expectation and service quality spec-
ifications
(C) customer expectation and internal management communication
(D) actual service delivery and how service quality was communicated: (D) actual
service delivery and how service quality was communicated
10. All of the following can be considered in the evaluation of a business unit
EXCEPT
(A) wages paid to labor
(B) projected annual revenues of competitors
(C) the cost of materials used in the production process
(D) the price at which goods produced are sold: (B) projected annual revenues of competitors
11. The sales division of a corporation is considering an internal product trans-
fer because of excess demand. What is the lowest acceptable transfer price
for the product?
(A) The amount that the company would have to pay to acquire a similar
product
