P&M Mock Test

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P&M Mock Test

All India Valuers Association P&M Mock Test 5

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1. Technology that permits safe, efficient, and inexpensive clean-up of contaminants in property tends to minimise __________ in asset value.

1 point

a. decrease

b. increase

c. fluctuations

d. variations

Clear selection

2. Which of the following is not covered under the Indian Forest Act, 1927?

1 point

a. Reserved forest

b. Village forest

c. Protected forest

d. Prohibited forest

Clear selection

3. Which of the following statements is not true about factors of production?

1 point

a. Land means natural resources.

b. Labour means human resources

c. Capital means financial resources

d. Entrepreneurship means pursuit of opportunity beyond resources controlled.

Clear selection

4. Other things remaining same, the law of demand states __________.

1 point

a. the higher the price, the lower the quantity demanded

b. the higher the price, the higher the quantity demanded

c. the higher the price, the lower the quantity supplied

d. the higher the price, the higher the quantity demanded

Clear selection

5. A market which has only one seller selling a homogeneous product to many buyers, is known as __________.

1 point

a. Monopoly

b. Oligopolistic

c. Perfect Competition

d. Monopolist Competition

Clear selection

6. Which of following activity is not the role of a valuer?

1 point

a. Physical verification

b. Estimation of replacement cost new

c. Market survey

d. Preparation of balance sheet

Clear selection

7. Potential income means

1 point

a. income that an enterprise is capable of earning

b. projected revenue

c. actual income earned by an enterprise

d. going-concern value

Clear selection

8. Which of the following does not represent auction market?

1 point

a. Sale of goods to a highest bidder

b. Awarding contract to a lowest service bidder

c. Purchase of goods through internet

d. Purchase of goods through internet by bidding

Clear selection

9. Which of the approaches is used by a valuer to determine present value of future economic benefits of owning the property?

1 point

a. Cost

b. Market

c. Income

d. Rule of thumb

Clear selection

10. A movable article which is used to make a room suitable for working can be classified as

1 point

a. plant

b. machinery

c. furniture

d. vehicle

Clear selection

11. In which of following methods, valuer adjusts prices paid for comparable assets with subject assets to estimate value?

1 point

a. Depreciated replacement cost method

b. Discounted cash flow

c. Rule of thumb method

d. Sales comparison method

Clear selection

12. Which one of the following values represents value in exchange?

1 point

a. Insurable value

b. Market value

c. Use value

d. Indemnity value

Clear selection

13. For a valuation exercise using the market approach, data collection does not normally include collecting which one of the following?

1 point

a. Technical specifications

b. Fixed Asset Register

c. Date of installation

d. Income attributable to the asset

Clear selection

14. Which of the following can be considered as an investment property?

1 point

a. A pharmaceutical unit

b. Public school

c. Townhall

d. Tata Sumo owned by Jackson for private use

Clear selection

15. Which of the following represents limitation of cost approach?

1 point

a. Quantifying depreciation for wear and tear

b. Cannot quantify economic obsolescence

c. Quantifying technological obsolescence

d. Estimation of replacement cost

Clear selection

16. Utility is the only value ingredient for which of the following property?

1 point

a. Investment property

b. Marketable non-investment property

c. Service property

d. Business assets

Clear selection

17. Which of the 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. Block of assets

Clear selection

18. 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. total life

d. physical life

Clear selection

19. 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

20. Discount received is recorded on which side of a cash book?

1 point

a. Receipts

b. Payments

c. Income

d. Expense

Clear selection

21. Which of the following building structure is treated as plant and machinery?

1 point

a. Water tank for township

b. Roads

c. Sewer

d. Chimney to boiler

Clear selection

22. Which of the following is a basis for charging depreciation under the Income Tax Act, 1961?

1 point

a. Block of asset

b. Item wise asset

c. Replacement cost

d. Residual value

Clear selection

23. Which one of the following is the only option for an investor when his/her earnings level

1 point

a. To liquidate assets

b. To increase the asset base by acquiring additional assets

c. To pledge the tangible assets as security and obtain additional capital

d. To buy new assets

Clear selection

24. Unit of maximum production according to the manufacturer's specification of equipment

1 point

a. installed capacity

b. actual production

c. licensed capacity

d. utilization capacity

Clear selection

25. Which of the following would not be included in Valuer`s Engagement Letter?

1 point

a. Timeline of the engagement

b. Management`s responsibilities with respect to financial records and accuracy of information

c. Terms of payment

d. Management representation

Clear selection

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