Financial management

1. An interest rate which is used in calculation of cash flows of bonds is called

required rate of redemption
required rate of earning
required rate of return
required option

Detailed SolutionAn interest rate which is used in calculation of cash flows of bonds is called

2. A Current Ratio of less than one means:

Fixed Assets > Current Assets
Share Capital > Current Assets

Detailed SolutionA Current Ratio of less than one means:

3. Value of stock is Rs 1200 and preferred dividend is Rs 120 then required rate of return would be

Rs 144,000.00
10.00%
Rs 10.00
0.2 times

Detailed SolutionValue of stock is Rs 1200 and preferred dividend is Rs 120 then required rate of return would be

4. Which of the following is incorrect for NOI?

k0 is constant
kd is constant
ke is constant
kd & k0 are constant

Detailed SolutionWhich of the following is incorrect for NOI?

5. Rate of return which considers riskiness and an available returns on investments is classified as

constant dividend
constant rate
maximum rate of return
minimum acceptable rate of return

Detailed SolutionRate of return which considers riskiness and an available returns on investments is classified as

6. Cost of issuing new shares to the public is known as:

Cost of Equity
Cost of Capital
Flotation Cost
Marginal Cost of Capital

Detailed SolutionCost of issuing new shares to the public is known as:

7. Profit margin multiply assets turnover multiply equity multiplier is used to calculate

return on turnover
return on stock
return on assets
return on equity

Detailed SolutionProfit margin multiply assets turnover multiply equity multiplier is used to calculate

8. According to the traditional approach cost of capital affected by?

debt-equity mix
debt-capital mix
equity expenses mix
debt-interest mix

Detailed SolutionAccording to the traditional approach cost of capital affected by?

9. In an option pricing, a rises in risk free rate results in option’s value

slight time decreases
slight increases
slight decreases
slight time increases

Detailed SolutionIn an option pricing, a rises in risk free rate results in option’s value

10. In calculation of time, value of money, ”N ”represents

number of payment periods
number of investment
number of instalments
number of premium received

Detailed SolutionIn calculation of time, value of money, ”N ”represents

Page 1Page 2Page 3Page 4Page 5
Test 1Test 2Test 3Test 4Test 5Test 6Test 7Test 8Test 9Test 10Test 11Test 12Test 13Test 14Test 15Test 16Test 17Test 18Test 19Test 20Test 21Test 22Test 23