SECTION A- MULTIPLE CHOICE QUESTIONS Answer all questions. Each question carries ONE (1) mark. Choose the best alternative answer. 1. Initial Public Offering (IPO) market is____________________. A. A market in which firms are offered for sale to the public for the first time. B. A market in which firms trade in their raw materials. C. A market in which firms offer shares to the public for the first time. D. A and B only.

2. Limited liability and ease of raising capital are advantages of a _______________. A. Sole proprietorship. B. Partnership. C. Corporation. D. Closed corporation.

3. Which of the following is the correct formula for the cash conversion cycle? A. Average age of inventory + average collection period average payment period. B. Average payment period average age of inventory + average collection period. C. Average age of inventory + average payment period average collection period. D. Operating cycle Average age of inventories.

4. Which of the following does not describe a money market? A. Key securities traded are bonds and stocks. B. A market for debt securities with maturities of one year or less. C. Examples are Treasury bill and Bank of Botswana certificates. D. A financial relationship between supplier and demanders of short-term financing.

5. The ratio of shareholders funds to total assets of the company is referred to as_____________. A. Debt-equity ratio. B. Economic equity ratio. C. Liquidity ratio. D. None of the above.