Test Your NCFM Fundamental Analysis Mock Test Knowledge in 5 Minutes

1. Identify the main area of study in fundamental analysis.

A. Tracking past price movements B. Assessing company financials and economic conditions C. Studying stock charts and trends D. Guessing price changes for tomorrow

2. Select the item that does not belong in a standard set of corporate financial reports.

A. Profit and Loss Statement B. Statement of Assets and Liabilities C. Statement of Cash Movements D. National Economic Stats

3. What information does the P/E ratio provide to an investor?

A. How much the market price swings B. The total yearly profit of the firm C. The price paid for every rupee of earnings per share D. The total amount of money in the bank

4. Which financial metric checks if a company can clear its debts due within a year?

A. Debt-to-Equity Proportion B. Current Ratio C. Price-to-Book Value D. Dividend Returns

5. What does it suggest when a stock offers a high dividend yield?

A. The business is keeping all profits for growth B. The stock price might be lower than its actual worth C. The business is failing to make any profit D. It has no impact on investor decisions

6. Pick an example of a "qualitative" factor used in analyzing a business.

A. Profit earned per share B. The capability of the management team C. Net margin of profit D. Cash coming from daily operations

7. Which of these is known as a "leading" economic indicator?

A. The growth rate of GDP B. The percentage of people without jobs C. The movements of the stock market D. The measure of inflation (CPI)

8. What is a possible reason for a company having negative cash flow?

A. The firm has zero debt B. The firm is definitely going bankrupt C. The firm is spending heavily on future expansion D. The firm has stopped making any sales

9. Which ratio tells us the mix of borrowed funds versus owner's funds?

A. P/E Proportion B. Debt-to-Equity Ratio C. Return on Total Assets D. Dividend Distribution Ratio

10. State the primary objective of performing fundamental analysis.

A. Finding quick profits from daily price changes B. Calculating the actual or "intrinsic" value of a company C. Guessing how other investors feel today D. Drawing patterns on price charts