APSET Paper 2 Mock Test - 2 (Commerce) - AP TET MCQ

The Correct Answer is Employee Loyalty.

Key PointsPerception is the process of interpreting and making sense of sensory information. In an organizational context, perception plays a role in a wide range of activities, including performance evaluation, performance expectations, and job evaluation.

Important Points

Managerial Implications of Perceptions

People in organisations are always judging each other. Managers must appraise their subordinate’s performance. Let us look at the more obvious applications of perceptions in organisations.

• Employment Interview: A major input into who is hired and who is rejected in any organisation is the employment interview. Evidence indicates that interviewers often make inaccurate perceptual judgements. Interviewers generally draw early impressions that become very quickly entrenched.
• Performance Evaluation: An employee’s performance appraisal very much depends on the perceptual process. The performance appraisal represents an assessment of an employee’s work. While this can be objective, many jobs are evaluated in subjective terms. Subjective measures are, by definition, judgemental.
• Performance Expectations: A manager’s expectations of an individual affect both the manager’s behaviour towards the individual and the individual’s response.
• Productivity: What individuals perceive from their work situation will influence their productivity.
• Job Satisfaction: Job satisfaction is a highly subjective, and feeling of the benefits that derive from the job. Clearly his variable is critically linked to perception.
• Job evaluation: It is a systematic process for assessing the relative worth of different jobs within an organization. It involves the use of various methods and criteria to evaluate the tasks, duties, and responsibilities associated with each job, and to determine the relative value of each job in comparison to others.

Additional Information

• Employee loyalty is a concept related to an employee's commitment to their organization, colleagues, and job.
• While perception can play a role in shaping an employee's perceptions of their organization and colleagues, loyalty is not typically considered an application of perception in organizations.
• Loyalty can certainly be increased by perception but cannot be measured by application of Perception.

Assertion (A): One finds always a difference of opinion between the Government and the RBI regarding interest rates.

Reasoning (R): While the main focus of the Government is on growth, the RBI always focuses on inflation.

Here,​ (A) is incorrect but (R) is correct

Key-Points

• The main government aims for the economy are full employment, price stability, economic growth, redistribution of income, and stability of the balance of payments. A government can operate a range of policy measures to achieve these aims and it is judged on their success or otherwise.
• The main purpose of the RBI is to conduct consolidated supervision of the financial sector in India, which is made up of commercial banks, financial institutions, and non-banking finance firms.
• An interest rate is the amount of interest due per period, as a proportion of the amount lent, deposited, or borrowed (called the principal sum). The total interest on an amount lent or borrowed depends on the principal sum, the interest rate, the compounding frequency, and the length of time over which it is lent deposited or borrowed.
• It is defined as the proportion of an amount loaned which a lender charges as interest to the borrower, normally expressed as an annual percentage. It is the rate a bank or other lender charges to borrow its money or the rate a bank pays its savers for keeping money in an account.
• To combat this, a country's appropriate monetary authority, like the central bank, then takes the necessary measures to manage the supply of money and credit to keep inflation within permissible limits and keep the economy running smoothly. However one cannot claim to always find a difference of opinion between the Government and the RBI regarding interest rates.

The correct answer is All the above.

Key Points

• Certain products and services like petroleum products, high-speed diesel, motor spirit, natural gas, aviation turbine fuel, and alcoholic liquor for human consumption do not come under GST.
• These products and services are taxed by the individual State Governments, as per their tax policies.

Additional Information

• GST is an indirect tax in India that is levied on the sale of goods and services in the country.
  • It is collected at the point of consumption and not at the point of origin.
  • It follows a multi-stage collection mechanism.
  • In this, tax is collected at every stage and the credit of tax paid at the previous stage is available as a set off at the next stage of the transaction.
• There are various types of GST:
  • CGST: Central GST
  • SGST: State GST
  • IGST: Integrated GST
• Goods & Services Tax Council is a constitutional body for making recommendations to the Union and State Government on issues related to Goods and Service Tax.
• The GST Council is chaired by the Union Finance Minister.
• The GST Council meets from time to time to revise the GST rates for various products.
• India currently has four primary GST rates of 5%, 12%, 18%, and 28%.
• The GST rate is 12% for computers and 28% for aerated drinks.
• Though edible items like sugar, tea, and coffee are included in the 5% slab, milk does not attract any tax under the new GST regime.
• As per Article 279A (1) of the amended Constitution, the GST Council has to be constituted by the President within 60 days of the commencement of Article 279A. 
• This Act is also called the Constitution (One Hundred and First Amendment) Act, 2016.

Reducing the capital of the company is called internal reconstruction. Internal reconstruction of a company is done through the reorganization of its share capital. It is a scheme of reorganization in which all interested parties in the capital structure volunteer to sacrifice.

WTO (World Trade Organisation) is a permanent inter-governmental body governing and regulating international trade in goods and services. The WTO has the following objectives: 

• To set and enforce rules for international trade 
• To provide a forum for negotiating and monitoring further trade liberalisation
• To resolve trade disputes
• To increase the transparency of decision-making processes 
• To cooperate with other major international economic trade-related issues

The correct option is Promotion of equitable distribution of wealth and income.

Key Points As per the passage:

• "The government budget...aiding in the government's socio-economic objectives."
• Furthermore, "It aids in striking a balance between the government's income and expenditure, at the same time steering the course of a nation's economy and contributing to its stability and growth."
• This equates to the promotion of equitable distribution of wealth and income.

The correct match is (1) - (c), (2) - (a), (3) - (b), (4) - (d).

Important Points Imperial Bank of India:

• On January 27, 1921, the Imperial Bank of India was founded. After the country attained independence, it changed its name to State Bank of India.
• The Bank of Calcutta's founding in 1806 marks the beginning of modern banking in India.
• It was renamed as the Bank of Bengal in 1809.
• The Bank of Bombay and the Bank of Madras then emerged in the 1840s.

RBI (Reserve Bank of India):

• The central bank of the country is the Reserve Bank of India (RBI), commonly referred to as the banker's bank.
• RBI established under the provisions of the Reserve Bank of India Act; it started operating on April 1st, 1935.
• RBI was founded to promote financial stability in India by implementing monetary policies to ensure monetary stability.
• In addition to managing the country's monetary system, government debt, foreign exchange reserves, and financial regulation and supervision, it also serves as a banker to the country's banks and government.

State Bank of India (SBI): 

• On July 1st, the State Bank of India was constituted under the State Bank of India Act 1955 in order to take over the operations and business of the Imperial Bank of India.
• In accordance with the Imperial Bank of India Act of 1920, the Imperial Bank of India was established in 1921. The Bank engages in all types of general banking activity, including merchant banking, mutual funds, and foreign exchange.

Industrial Development Bank of India: 

• The primary financial institution for providing credit and other facilities for growing companies and supporting development institutions is the Industrial Development Bank of India (IDBI), which was founded under the Industrial Development Bank of India Act, 1964.
• Up until 1976, IDBI was a bank that belonged to the RBI. It was split off from the RBI in 1976, and the Indian government now owns it. In terms of development, IDBI is the tenth-largest bank in the world.

The correct answer is 283.

Important Points

• ITNS Challan Number 283 is used for payment of Fringe Benefits Tax.
• Fringe benefit tax (FBT) was a form of tax that companies paid in lieu of benefits they offered their employees in addition to the compensation paid to them. It was included by the Finance Act 2005 with effect from April 1, 2006.
• The Income Tax Department's Challan ITNS 284 is used to pay Income Tax on Corporations (Corporation Tax) and Income Tax on Other than Corporations.
• The Income Tax Department's Challan ITNS 283 is used to pay the Banking Cash Transaction Tax and Fringe Benefits Tax.
• To deposit gift tax, estate duty, spending tax, and other miscellaneous taxes use the ITNS 282 form. 

Refer to, “True, there have been some benefits. For instance, the number of income tax returns filed has surged a little over the trend growth rate. But surely this could have been achieved by other policy measures. Cashless modes of payment have become more common, but financial savings in the form of currency have also risen, suggesting that people still value cash.”

Statement I is correct since people are now more into filing of income tax returns in order to be on the safe side and also to prevent any wrong impression of the income tax department towards them.

Statement II is correct since the citizens are now resorting to the cashless modes of transactions but they still value cash based transactions.

Statement III is not correct since there is no reference in the passage that the RBI has become proactive post demonetization regarding detection of money laundering activities in the country. This can be eliminated.

The correct answer is Increasing returns to scale

Key Points
The CES Production Function:

• The Constant Elasticity of Substitution (CES) function was established by Arrow, Chenery, Minhas, and Solow in their 1961 work.
• Three variables, Q, C, and L, and three parameters, A, θ and, α make up this function.

It may be expressed in the form:

Q = A [aC^-θ+ (l-α)L^-θ] ^-1/θ

where,

Q is the total output,

С is capital, and L is labour.

A is the efficiency parameter indicating the state of technology and organisational aspects of production

Important Points

• The CES production function is a neoclassical production function, which shows a constant elasticity of substitution.
• In other words, the percentage change in the marginal rate of technical substitution.
• Due to this there is a constant percentage change in the ratio of factors (like labour and capital) in production technology.
• If the scale parameter > 1 there will be increasing returns to scale.
• If the scale parameter < 1 there will be decreasing returns to scales.
• If the scale parameter = 1 there will be constant returns to scale (case of linear homogenous CDPF)

3 Views of Conflict: Traditional View, Human Relations View, Interactionist View of Conflict. where each view treats and manages conflict uniquely and differently.

• Organizational conflict is the discord that arises when the goals, interests, or values of different individuals or groups are incompatible and those individuals or groups block or thwart one another’s attempts to achieve their objective.
• Conflicts can occur because of the task, relationship, or process-related issues between personnel.
• Conflicts at the organization were perceived or viewed as only a negative object.
• But through the development of “organizational behavior” studies; conflict is now viewed differently and organizations now learned how to manage them.
• But, there is conflict over the role of conflict in groups and organizations.
• Changing Views of Organizational Conflict
• Attitude towards conflict in organizations has changed considerably in the last few decades.
• Once upon a time conflict was considered fully harmful and must be avoided for the betterment of the organization.
• With the passes of time, those views changed largely. Conflict is now an inevitable part of organizations. Its presence is positive in some aspects.
• Here explain the 3 different views on organizational conflicts. With continuous studies and researches in the field of organizational behavior and management, that thinking gradually changed.
• These views advocate the same concept that there are different types of conflicts and not all of them have to be bad and dysfunctional.

Walter's Model shows the clear relationship between the return on investments or internal rate of return (r) and the cost of capital (K). If r < K, the firm should pay all its earnings to the shareholders in the form of dividends because they have better investment opportunities than a firm.

The correct answer is Competitive advantage.

Key Points

Trade secrets:

• Trade secrets refer to valuable, confidential, and non-public information that is kept secret within an organization.
• They can include formulas, processes, methods, customer lists, marketing strategies, and other proprietary information.
• Trade secrets are important for maintaining a competitive advantage in the market.

Important Points

Competitive Advantage:

• Trade secrets provide a unique competitive advantage to companies.
• By keeping certain information secret, companies can differentiate themselves from competitors and have an edge in the market.
• Trade secrets allow companies to maintain their unique processes, techniques, or information that gives them an advantage over others.

Confidentiality and Exclusivity:

• Trade secrets allow companies to protect valuable information from being disclosed to competitors or the public.
• This confidentiality and exclusivity give them an upper hand in the market, as competitors cannot replicate or imitate their secret methods or strategies.

Cost-effectiveness:

• Unlike other forms of intellectual property protection, such as patents or trademarks, trade secrets do not require formal registration or filing fees.
• They can be maintained and protected internally, making them a cost-effective way of safeguarding valuable information.

Longevity:

• Trade secrets can provide long-term protection, as long as the information remains confidential.
• Unlike patents or trademarks that have expiration dates, trade secrets can be kept indefinitely as long as they are not publicly disclosed.
• This allows companies to have a sustained competitive advantage over an extended period.

Overall, trade secrets are valuable assets for companies as they provide a competitive edge, maintain confidentiality and exclusivity, are cost-effective, and offer long-term protection.

Protecting trade secrets can help companies maintain their market position, enhance innovation, and preserve their unique know-how and techniques.

The correct answer is ​ Both the assertion and reason are true, and the reason is the correct explanation of the assertion.

Key Point

The assertion is true: government regulations do play a vital role in shaping the business environment. The reason provided is also valid: government regulations help maintain fair competition and protect consumer interests. Government regulations serve as a framework that guides the conduct and operations of businesses, ensuring that they operate in a manner that benefits society as a whole. Here are some points that support this assertion:

• Fair competition: Government regulations establish rules and standards that promote fair competition in the marketplace. Regulations can include antitrust laws that prevent monopolistic practices and promote competition among businesses. By maintaining a level playing field, regulations prevent the concentration of power in the hands of a few companies and encourage innovation and market efficiency.
• Consumer protection: Government regulations often include measures aimed at protecting consumer interests. These can range from product safety standards and labeling requirements to consumer rights protection laws. Regulations ensure that businesses provide accurate information about their products or services, adhere to quality standards, and handle customer complaints or disputes fairly. This helps build consumer trust and confidence in the market.
• Environmental and social responsibility: Government regulations can also address environmental and social concerns related to business activities. Regulations may establish guidelines for environmental sustainability, worker safety, fair labor practices, and corporate social responsibility. By imposing regulations in these areas, governments encourage businesses to operate in a manner that minimizes negative impacts on the environment and society.
• Stability and predictability: Government regulations provide stability and predictability to the business environment. Clear and consistent regulations create a framework in which businesses can plan and operate. Regulations help establish standards, procedures, and legal frameworks that businesses can rely on, reducing uncertainty and facilitating long-term investment and growth.
• Economic stability and public interest: Government regulations are often aimed at ensuring economic stability and protecting public interest. Regulations can include financial regulations, taxation policies, and monetary policies that aim to maintain a stable economy, prevent fraud or abuse, and protect the interests of the public and stakeholders.

Valuation of shares is the process of determining the fair value of the company shares.

Key PointsYield Or Market Value Method Of Valuation Of Shares:

• Under the yield method, the emphasis goes to the yield that an investor expects from his investment.
• The yield, here we mean, is the possible return that an investor gets out of his holdings—dividend, bonus shares, right issue.
• If the return is more, the price of the share is also more.
• Under this method, the valuation of shares is obtained by comparing the expected rate of return with the normal rate of return.

• The normal rate of return, for individuals, is the average rate of return on all investments, i.e. the average of all returns yields the normal rate of return.
• Determining the normal rate of return for the valuation of shares in the Market value method comprises of following:
  • The risk involved in a particular share or class of share in which amount is to be invested, 
  • Current market rate and trends in companies market value,
  • Cost of capital of particular company so as to find the performance of the company, and
  • The weighted average cost of capital.

Thus, option 4 is the correct answer.

The ‘law of one price’ states that in competitive markets free of transportation costs and barriers to trade, identical products sold in different countries must sell for the same price when their price is expressed in terms of the same currency.

An ‘Efficient market’ has no impediments to the free flow of goods and services, such as trade barriers.

Both statements are correct.

• The law of one price is an economic concept that states that the price of an identical asset or commodity will have the same price globally, regardless of location, when certain factors are considered.
• The law of one price takes into account a frictionless market, where there are no transaction costs, transportation costs, or legal restrictions, the currency exchange rates are the same, and that there is no price manipulation by buyers or sellers. 
• An efficient market has no impediments to the free flow of goods and services, such as trade barriers, and prices reflect all available public information. By comparing the prices of identical products in different currencies, it would be possible to determine the "real" or PPP exchange rate that would exist if markets were efficient.

Key PointsA Non-Government Company Is Also Known As Private Company.

The companies whose shares cannot be traded publicly are termed Private companies. Shares of these companies are not available for trade openly in the market. Private companies are held & controlled by a few private individuals privately.

Following are the features of a Private Company:

Therefore, member's liability is limitless is not a characteristic of a non-government company.

The correct answer is Closed economy, unemployment in the economy, constant marginal propensity to consume.

Key Points

• The investment multiplier is an important part of economic theories suggested by notable economist John Maynard Keynes.
• According to this concept, in the event of an increase in investment activities either public or private which can be in the form of private consumption spending, or government spending in an economy, there is a corresponding increase in the Gross Domestic Product (GDP) of the economy by a value more than the amount invested.
• In simple words, the investment multiplier refers to the increase in the aggregate income of the economy as a result of an increase in the investments done by the government in the form of new projects.
• The size of the investment multiplier is determined by the decisions of the households in an economy in the areas of spending (which is known as the marginal propensity to consume) or saving (known as the marginal propensity to save).

Important Points Formulae:

K = ΔY / ΔI

• Where, ΔY = Increase in GDP or National Income
• ΔI = Increase in Investment

K = 1/ 1- MPC

• Where k = Investment Multiplier
• MPC = Marginal Propensity to Consume

K = 1/ MPS

• Where k = Investment Multiplier
• MPS = Marginal Propensity to Save

Keynes’ multiplier principle is based on the fol­lowing assumptions:

• Autonomous Investment
• Lump-Sum Taxes
• Availability of Consumption Goods
• Continuity of Investment
• Positive Net Investment
• Stability of MPC
• Closed Economy
• No Time Lag Between Successive Expenditures on Con­sumption Goods
• Unemployed Resources

Hence, a Closed economy, unemployment in the economy, and constant marginal propensity to consume may not render the investment multiplier inapplicable as there are the main assumptions of the investment multiplier.

Marginal Product Curve shows the relation between marginal product and the quantity of the variable input. This curve shows the incremental change in output at each level of a variable input. Its shape is in the form of a hump or an inverse U because of increasing marginal returns in the beginning followed by decreasing and then diminishing marginal returns.

The correct answer is option 3.

Concept:

​Copyright Infringement:

The unauthorized use of someone else's copyrighted work is called copyright infringement. As a result, it is the unauthorized use of another person's copyrighted work, infringing on the copyright holder's rights to reproduce, distribute, exhibit, or perform the protected work.

Explanation:

Consider the following real-life example.

PersonX is free to record a TV program to view it later, but if he transfers or distributes it PersonY. So the given example is copyright Infringement.

• Copyright infringement occurs when a third party infringes on the copyright holder's rights, such as the exclusive use of a work for a specified period of time.
• Music and movies are two of the most well-known kinds of entertainment that are subjected to substantial copyright violations. Infringement lawsuits may result in contingent liabilities, or funds set aside in the event of a lawsuit.

Hence the correct answer is Copyright Infringement.

Additional Information

• Hacking is the act of unauthorized access to a computer, computer network, or any digital system. Hackers usually have the technical expertise in hardware and software.
• Identity thieves increasingly use personal information stolen from computers or computer networks, to commit fraud by using the data gained unlawfully.
• Cyberbullying is bullying with the use of digital technologies. It can take place on social media, messaging platforms, gaming platforms, and mobile phones.

The correct answer is ​Socio-Economic condition.

• In India, the creamy layer is defined as an economically and socially backward class.

Key Points

• The term creamy layer was used by the Santhanam Commission in the year 1971.
• At present, a family with a minimum annual income of ` 8 lakhs has been placed under the creamy layer.
• Backward class people coming to the creamy layer are out of the purview of reservation.

Key Points

Simple Regression Analysis:

A simple regression analysis is essentially a statistical technique used to quantify the relationship between a single independent variable and a single dependent variable based on historical observations.

Important Points

Least Squares method used in Simple Regression Analysis:

Finding a regression line or best-fitted line for any collection of data that is specified by an equation is done using the least square method. With this technique, the trend of the results is discovered quantitatively by reducing the sum of the squares of the residual sections of the points from the curve or line. When performing regression analysis, the least square method is used to fit equations to the data in order to derive the curve.

• The primary goal of this methodology is to minimize the sum of squared errors. This explains why this approach is known as the least-squares approach.
• A statistical technique called the least-squares method is used to determine which equation, such as y = mx + b, best fits the data. According to the regression equation, it minimizes the sum of the squared differences between the dependent variable's estimated values and actual values.
• This approach is frequently used in data fitting, where the goal is to minimize the sum of squared errors, which is thought to represent the discrepancy between the observed values and the corresponding fitted values.
• The behaviour of the dependent variable with respect to the independent variable is predicted using the least-squares method.
• Variance is the product of the square of the errors.
• The least-squares method's primary goal is to reduce the total squared errors.

Hence, it is true that least squares method used in simple regression analysis minimises the sum of the squared differences between the actual values of dependent variable and the estimated values of the dependent variable as per regression equation

Key PointsGrouped data is created by grouping each observation so that the groups provide a more insightful approach to analysing the data. The mean of grouped data can be determined using one of three methods.

• Direct Method
• Shortcut Method
• Step Deviation Method

Important PointsArithmetic Mean: The ratio of the sum of all observations to the total number of observations is known as the Arithmetic Mean (AM) or average in statistics.

Arithmetic Mean =  

Where,

• x₁, x₂, x₃, x_n are the observations
• n is the number of observations

Assumptions in order to determine the arithmetic mean:

• Intervals between classes must be closed.
• Each class interval should be the same width.
• Each class interval's mid-value must be the mean of all values inside that class.

Thus, the correct solutions are A, B and C only.

As the period of the moving mean in the time series increases, the trend curve will be further from the original curve.

The moving mean model is probably the simplest way of modeling time series.

This model simply states that the next observation is the mean of all previous observations.

Simply put, this model can be surprisingly good and it represents a good starting point.

Otherwise, the moving mean can be used to identify interesting trends in the data.

We can define a window to flatten the time series and apply the moving mean model to uncover different trends.

 is used to calculate the standard error of the coefficient of correlation between 25 paired observations of a sample.

Price skimming is a product pricing strategy by which a firm charges the highest initial price that customers will pay and then lowers it over time.

• As the demand of the first customers is satisfied and competition enters the market, the firm lowers the price to attract another, a more price-sensitive segment of the population.
• Price skimming is often used when a new type of product enters the market. The goal is to gather as much revenue as possible while consumer demand is high and competition has not entered the market.
• The skimming strategy gets its name from "skimming" successive layers of cream, or customer segments, as prices are lowered over time.

The correct answer is option 3

Key Points The correct match is given below:

Important PointsR. A. Fisher - Anova

• Developed by Ronald Fisher, ANOVA stands for Analysis of Variance. 
• The statistical approach of analysis of variance, or ANOVA, divides observed variance data into multiple components for use in additional tests.
• For three or more groups of data, a one-way ANOVA is used to learn more about the relationship between the dependent and independent variables.
• If there is no real variance between the groups, the F-ratio of the ANOVA should be near to 1.

Karl Pearson - Correlation

• The Pearson's product-moment correlation coefficient (abbreviated as r or rxy) is a measure of the strength of a linear link between two variables (x and y being the two variables involved).

Formula for Karl Pearson - Correlation is 

Spearman - Rank Correlation

• Spearman’s correlation coefficient is a statistical measure of the strength of a monotonic relationship between paired data
• Spearman's Rank correlation coefficient is a technique which can be used to summarise the strength and direction (negative or positive) of a relationship between two variables.​
• The result will always be between 1 and minus 1.

Formula for Spearman - Rank Correlation is

Gosset - Student’s t distribution

• The t test tells you how significant the differences between groups are; In other words, it lets you know if those differences (measured in means) could have happened by chance.
• The t score is a proportion of the difference between two groups divided by the difference between groups.
• The greater the t score, the greater the difference between groups. The smaller the t score, the closer the groups are related.

The correct answer is C, E, F only.

Key Points A. Financial leverage increases the company's fixed costs.
This statement is incorrect. Financial leverage does not directly impact fixed costs. Fixed costs are expenses that do not vary with the level of sales or production.

B. Financial leverage decreases the company's risk.
This statement is incorrect. Financial leverage actually increases the company's risk. While it can potentially enhance returns, it also increases the company's financial obligations and vulnerability to economic downturns or changes in interest rates.

C. Financial leverage involves using debt to finance a portion of the company's assets.
This statement is correct. Financial leverage refers to the use of borrowed funds or debt to finance a portion of a company's assets. By utilizing debt, a company can amplify its returns on investment, as the cost of debt is typically lower than the expected return on investment.

D. Financial leverage has no impact on the company's profitability.
This statement is incorrect. Financial leverage can impact the company's profitability. By using debt, a company incurs interest expenses, which can reduce its net income and profitability.

E. Investors use leverage to multiply their buying power in the market.
This statement is correct. Investors can use leverage to increase their buying power and potentially amplify their returns. By using borrowed funds, investors can control larger positions in the market than they would be able to with their own capital alone.

F. Misuse of leverage may have serious consequences, as there are some that believe it played a factor in the 2008 Global Financial Crisis.
This statement is correct. The misuse of leverage, particularly in the form of excessive risk-taking and improper financial practices, was believed to be a contributing factor to the 2008 Global Financial Crisis. Improper use of leverage can lead to significant financial instability and systemic risks.

Based on the evaluation, the correct statements are:

C. Financial leverage involves using debt to finance a portion of the company's assets.
E. Investors use leverage to multiply their buying power in the market.
F. Misuse of leverage may have serious consequences, as there are some that believe it played a factor in the 2008 Global Financial Crisis.

Therefore, the correct answer is: C, E, and F.

There are 4 types of responsibility accounting: Cost, revenue, profit, and investment center.