Fiqh MCQs

Business and Commercial Transactions

The following are Business and Commercial Transactions MCQs with answers related to Islamic Studies. We have arranged the most important and repeated MCQs in all the competitive examinations. The students can clear their concepts for Business and Commercial Transactions MCQs online quiz by attempting these.

Business and Commercial Transactions Online MCQs with Answers

Which legal document outlines a company’s purpose, structure, and regulations?
A) Business plan
B) Memorandum of Understanding
C) Articles of Incorporation
D) Partnership agreement

Answer
C

What term refers to the transfer of ownership of a product from a seller to a buyer?
A) Negotiation
B) Conveyance
C) Delivery
D) Disposition

Answer
B

In which market structure does a single company dominate the entire market?
A) Perfect competition
B) Monopoly
C) Oligopoly
D) Monopolistic competition

Answer
B

What’s a balance sheet primarily used for?
A) Showing revenue and expenses
B) Presenting cash flow
C) Displaying assets and liabilities
D) Projecting future profits

Answer
C

Which type of business entity offers limited liability to its owners?
A) Sole proprietorship
B) Partnership
C) Corporation
D) Cooperative

Answer
C

What does “ROI” stand for in business?
A) Return on Investment
B) Rate of Income
C) Revenue over Interest
D) Risk of Inflation

Answer
A

Which economic system relies on supply and demand to determine prices?
A) Command economy
B) Mixed economy
C) Market economy
D) Traditional economy

Answer
C

What’s a “merger” in the business context?
A) Selling a product at a discount
B) Combining two or more companies into one
C) Acquiring new customers
D) Liquidating a company

Answer
B

What’s the purpose of a SWOT analysis in business?
A) Analyzing financial statements
B) Evaluating market trends
C) Identifying strengths, weaknesses, opportunities, and threats
D) Creating a sales forecast

Answer
C

What’s the main function of the Federal Reserve in the United States?
A) Fiscal policy
B) Monetary policy
C) Trade regulation
D) Consumer protection

Answer
B

In accounting, what does “GAAP” stand for?
A) General Accounting and Auditing Protocol
B) Generally Accepted Accounting Principles
C) Global Accounting and Auditing Procedures
D) General Accounting and Auditing Practices

Answer
B

Which type of contract involves a promise in exchange for a promise, with both sides being bound?
A) Unilateral contract
B) Void contract
C) Bilateral contract
D) Express contract

Answer
C

What’s the purpose of a non-disclosure agreement (NDA)?
A) Promoting products
B) Setting payment terms
C) Sharing confidential information
D) Negotiating mergers

Answer
C

In which phase of the business cycle does economic activity decline significantly?
A) Expansion
B) Peak
C) Contraction
D) Trough

Answer
C

What’s a common method for valuing a company’s stock?
A) Book value
B) Face value
C) Market value
D) Replacement value

Answer
C

Which international organization deals with trade rules between nations?
A) United Nations
B) International Monetary Fund (IMF)
C) World Trade Organization (WTO)
D) World Bank

Answer
C

What’s the process of converting assets into cash called?
A) Depreciation
B) Amortization
C) Liquidation
D) Revaluation

Answer
C

What’s a “venture capitalist”?
A) A company’s top executive
B) An entrepreneur
C) An investor who provides funds to startup companies
D) A government regulator

Answer
C

What’s the term for a legally binding promise to do something or refrain from doing something?
A) Consideration
B) Agreement
C) Offer
D) Contract

Answer
D

What does the acronym “CAGR” stand for?
A) Cumulative Annual Growth Rate
B) Comprehensive Annual Growth Return
C) Continuous Average Growth Rate
D) Current Annual Growth Ratio

Answer
A

What’s the main purpose of branding in business?
A) Reducing costs
B) Attracting investors
C) Communicating value and identity to customers
D) Managing supply chains

Answer
C

Which financial statement shows a company’s revenues and expenses over a specific period?
A) Balance sheet
B) Income statement
C) Statement of cash flows
D) Statement of retained earnings

Answer
B

What’s a “hostile takeover”?
A) A merger with mutual agreement
B) An acquisition against the wishes of the target company’s management
C) A joint venture between competitors
D) A merger between unrelated industries

Answer
B

Which economic indicator measures the average change in prices for a basket of consumer goods and services?
A) GDP
B) CPI
C) PPI
D) GNP

Answer
B

What’s the term for the money a business earns after deducting expenses?
A) Revenue
B) Profit
C) Capital
D) Equity

Answer
B

What’s a “franchise” in business?
A) A government tax incentive
B) A type of loan
C) A legal right to operate a business using a well-known brand
D) A type of partnership

Answer
C

What’s the term for the value of a company’s outstanding shares of stock?
A) Face value
B) Book value
C) Market value
D) Par value

Answer
C

What’s the primary goal of supply chain management?
A) Maximizing shareholder value
B) Reducing employee turnover
C) Minimizing production costs
D) Efficiently delivering products to customers

Answer
D

What’s a “fiduciary duty”?
A) Legal responsibility to act in the best interest of others
B) Debt obligation of a corporation
C) Annual financial reporting requirement
D) Ownership share in a company

Answer
A

Which type of business entity is owned and operated by a single individual?
A) Corporation
B) Partnership
C) Limited liability company (LLC)
D) Sole proprietorship

Answer
D

What’s the process of turning inputs like raw materials into finished products called?
A) Distribution
B) Marketing
C) Production
D) Sales

Answer
C

What’s the term for a temporary ban on trade with a particular country?
A) Boycott
B) Sanction
C) Embargo
D) Tariff

Answer
C

What’s “intellectual property” in business?
A) Tangible assets like buildings and equipment
B) Ideas, inventions, and creative works
C) Stocks and bonds
D) Financial statements

Answer
B

What’s the purpose of a “letter of credit” in international trade?
A) Marketing a product to a new audience
B) Extending a line of credit to customers
C) Ensuring payment for goods between buyer and seller
D) Offering a discount on products

Answer
C

What’s the term for the process of assessing and managing potential risks in a business?
A) Diversification
B) Risk analysis
C) Risk management
D) Opportunity assessment

Answer
C

What’s “liquidity” in finance?
A) The ability to sell an asset quickly without significantly affecting its price
B) The amount of debt a company holds
C) The profitability of an investment
D) The difference between revenue and expenses

Answer
A

What’s the term for an economic downturn characterized by high unemployment and reduced consumer spending?
A) Depression
B) Recession
C) Inflation
D) Expansion

Answer
B

What’s the primary purpose of a business plan?
A) Documenting employee salaries
B) Predicting the stock market
C) Outlining a company’s goals and strategies
D) Managing day-to-day operations

Answer
C

What’s “offshoring” in business?
A) Producing goods domestically
B) Outsourcing tasks to a neighboring country
C) Moving company operations to another country
D) Operating only in international waters

Answer
C

What’s the term for the financial return an investor receives from holding an asset?
A) Interest
B) Profit
C) Return on Investment (ROI)
D) Dividend

Answer
B

Which type of market structure features a few large firms that dominate the industry?
A) Monopoly
B) Oligopoly
C) Perfect competition
D) Monopolistic competition

Answer
B

What’s the term for a legal claim on a borrower’s assets in the event of loan default?
A) Mortgage
B) Lien
C) Collateral
D) Bond

Answer
B

Which type of intellectual property protection covers original artistic works?
A) Copyright
B) Trademark
C) Patent
D) Trade secret

Answer
A

What’s the process of examining a company’s financial statements and records to ensure accuracy and compliance?
A) Auditing
B) Marketing
C) Forecasting
D) Budgeting

Answer
A

Which type of business structure offers the advantages of limited liability and pass-through taxation?
A) Corporation
B) Partnership
C) Sole proprietorship
D) Limited liability company (LLC)

Answer
D

What’s the term for a government’s expenditures exceeding its revenue, leading to increased debt?
A) Surplus
B) Deficit
C) Balanced budget
D) Trade deficit

Answer
B

Which type of business negotiation involves reaching an agreement without the involvement of a judge?
A) Arbitration
B) Mediation
C) Litigation
D) Legislation

Answer
B

What’s the term for the difference between a company’s total revenue and total cost?
A) Gross profit
B) Net profit
C) Operating profit
D) Earnings before interest and taxes (EBIT)

Answer
B

What’s the term for the process of converting sales revenue into cash?
A) Accounts payable
B) Accounts receivable
C) Cash flow
D) Inventory turnover

Answer
C

What’s a “stakeholder” in business?
A) A type of investment
B) An employee of a company
C) An individual or group with an interest in a company’s actions and success
D) A type of financial statement

Answer
C

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