P&M Mock Test

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P&M Mock Test

All India Valuers Association P&M Mock Test 4

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1. Which of the following is an example of secondary sector of an economy?

1 point

a. Mining

b. Forestry

c. Food Processing

d. Pisciculture

Clear selection

2. Which one of the following is estimated by floating inquiry?

1 point

a. Replacement cost

b. Depreciated replacement cost

c. Scrap value

d. Fair value

Clear selection

3. Which of the following is not true about Ricardian theory of rent?

1 point

a. Rent increases with increase in population.

b. Rent is surplus above cost.

c. Rent is unearned income.

d. Rent arises only in the short run.

Clear selection

4. A valuer shall act with objectivity in his professional dealings by ensuring that his decisions are made __________.

1 point

a. without the presence of any bias

b. with coercion

c. with confidence

d. with undue influence of any party

Clear selection

5. Date of commissioning of a new plant is useful for which of the purposes in valuation process?

1 point

a. Computation of depreciation

b. Computation of functional obsolescence

c. Computation of economic obsolescence

d. Computation of profit

Clear selection

6. In which of following purposes of valuation, replacement cost new is considered as value of asset?

1 point

a. Auction

b. Collateral security

c. Purchase price allocation

d. Insurance

Clear selection

7. Which of the following are treated as buildings in a valuation exercise?

1 point

a. Foundation of machine

b. Supporting steel structures for a boiler

c. Fixtures

d. Roads

Clear selection

8. In case of dairy, the process that prevents cream and milk from separating is known as?

1 point

a. Pasteurisation

b. Homogenisation

c. Sterilisation

d. Emulsification

Clear selection

9. If a person has an income of Rs.30000 and his consumption is Rs.10000, then his propensity to save is __________.

1 point

a. 1.33

b. 0.33

c. 0.67

d. 1.50

Clear selection

10. Which of the following legislations does not provide for pollution control?

1 point

a. The Water (Prevention and Control of Pollution) Act, 1974

b. The Air (Prevention and Control of Pollution) Act, 1974

c. The Environment (Protection) Act, 1986

d. The Technology (Transfer of Abuse) Act, 2007

Clear selection

11. Which of following depreciation methods has equal amount of depreciation worked out year wise?

1 point

a. Straight line

b. Reducing balance

c. Sum of years digits method

d. Iowa Curve

Clear selection

12. Bed length is one of factor used for quoting prices for which of the following machine?

1 point

a. Lathe

b. Milling

c. Grinder

d. Hacksaw

Clear selection

13. Which of the following equipment is used for transferring heat from one fluid to another?

1 point

a. Heat exchangers?

b. Centrifugal machines

c. Hot air generator

d. Incinerator

Clear selection

14. Which technique helps to focus on major items during site visit is known as .

1 point

a. Balance sheet study

b. Market research

c. ABC analysis

d. Reconciliation of data received

Clear selection

15. Which one of the following is a requirement of a valuation report?

1 point

a. Preparing report without inspection

b. To give report as per the value required by the client.

c. To give report which can withstand the test of cross examination in a court

d. To prepare report without consideration of valuation

Clear selection

16. A note on exclusion of site investigation for fear of contamination of valuation site if any appears in section of the report.

1 point

a. transmittal letter

b. valuation methodology

c. valuation procedures

d. assumptions and limiting conditions

Clear selection

17. An asset is officially appraised and priced on .

1 point

a. verification date

b. valuation date

c. report date

d. effective date

Clear selection

18 Which of the following type of risk is considered as a default risk?

1 point

a. Economy risk

b. Interest rate risk

c. Purchase power risk

d. Currency risk

Clear selection

19. Which of following approach is normally used for valuation of plant and machinery assets for leasing?

1 point

a. Income

b. Cost

c. Market

d. Cost and Market

Clear selection

20. In which type of lease, lessees recognise assets and liabilities in their balance sheets?

1 point

a. Finance

b. Operating

c. Partial payment lease

d. Specialized service lease

Clear selection

21. Which of the following is a direct cost component of replacement cost?

1 point

a. Material cost

b. Finance charges

c. Legal fees

d. License fees

Clear selection

22. Damage caused to an asset naturally as a result of aging is known as __________.

1 point

a. wear and tear

b. economic obsolescence

c. functional obsolescence

d. operating obsolescence

Clear selection

23. Which of the following approaches is generally used while valuing specialized plant and machinery?

1 point

a. Market

b. Income

c. Cost

d. Sales comparison

Clear selection

24. Which planning provision is required around the battery limit of industry and for industry having odour problem?

1 point

a. No development zone

b. Green belt

c. Special permission zone

d. Industrial regulation zone

Clear selection

25 Number of years for which a new asset is profitably used for its intended purpose is known as __________.

1 point

a. Economic life

b. Normal useful life

c. Age

d. Physical life

Clear selection

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