UGC NET Commerce Unit 4 PYQs, Important Questions

UGC NET Commerce Unit 4 PYQs focus on important topics of Business Finance that are frequently asked in the exam. This unit helps students understand key concepts like securitization, cost of capital, capital budgeting techniques, share valuation models, and financial theories such as Modigliani–Miller and the Gordon Model. 

PYQs from this unit are very useful because they not only test theoretical knowledge but also check how well you can apply formulas and concepts in practical situations. With regular practice of these questions, students can improve accuracy, speed, and confidence for the UGC NET Commerce exam.

UGC NET Commerce Unit 4 PYQs

UGC NET Commerce Unit 4 (Business Finance) PYQs are very helpful for students because they provide a clear understanding of the exam pattern and the types of questions that are commonly asked in the exam.

Practicing these PYQs helps students strengthen their conceptual understanding, improve accuracy and speed, and identify important and high-weightage topics. Overall, these PYQs play an important role in effective preparation and help students perform better in the UGC NET Commerce exam.

Q1. Arrange the following steps of securitisation in the correct sequence.

A. Forming SPV
B. Transfer to SPV
C. Credit Enhancement
D. Seasoning
E. Issuance of Securities

Choose the correct answer from the options given below:

(A) A, B, C, D, E
(B) B, C, A, D, E
(C) D, C, A, B, E
(D) D, C, B, A, E

Answer: D, C, A, B, E

Q2. The total return on an equity stock during a year was 12.5%. The inflation rate during the year was 3.5%. 

Options:

• A. 9.26%

• B. 16.00%

• C. 7.65 %

• D. 8.70%

Answer: D. 8.70%

Q3. The profitability index of a project is the ratio of the present value of cash inflows to:

Options:

• A. Total Cash Inflows

• B. Total Cash Outflows

• C. Present Value of Cash Outflows

• D. Initial Cost Minus Depreciation

Answer: C. Present Value of Cash Outflows

Q4. Under the Yield Method of Valuation of Equity, for an equity share of ₹50, the normal rate of return is 10% and the expected rate of return is 5%. The value of the equity share will be:

Options:

• A. ₹25

• B. ₹40

• C. ₹50

• D. ₹100

Answer: A. ₹25

Q5. Compute the after-tax cost of capital of a company in case a perpetual bond (face value is ₹100) is sold as well as redeemed at par having coupon rate of interest being 7% and corporate tax rate is 30%.

Options:

• (A) 2.1%

• (B) 4.9%

• (C) 7%

• (D) 10%

Answer: B 4.9%

Benefits of Using UGC NET Commerce Unit 4 PYQs

Previous Year Questions (PYQs) are very useful for exam preparation because they help students understand the actual exam pattern and question style. They also show which topics are most important and frequently repeated in the exam:

• Previous Year Questions help students understand the real exam pattern and the type of questions asked in the exam.

• They highlight the important and frequently repeated topics, which helps in better preparation.

• PYQs improve concept clarity because students learn how theoretical concepts are applied in real exam questions.

• They develop problem-solving ability by exposing students to different types of analytical questions.

• Regular practice of PYQs helps in improving time management during the actual examination.

• They build confidence by familiarizing students with the actual difficulty level of the exam.

• PYQs reduce exam fear and confusion by providing a clear idea of what to expect.

• They also serve as an effective revision tool before the final exam.