Financial management

1. Set of rules made by corporation founders such as directors election procedure are classified as

stock laws
by laws
liability laws
corporate laws

Detailed SolutionSet of rules made by corporation founders such as directors election procedure are classified as

2. In case of the indivisible projects, which of the following may not give the optimum result?

Internal Rate of Return
Profitability Index
Feasibility Set Approach
All of the above

Detailed SolutionIn case of the indivisible projects, which of the following may not give the optimum result?

3. Type of options that do not have stock in portfolio to back up options is classified as

undue options
due options
naked options
total options

Detailed SolutionType of options that do not have stock in portfolio to back up options is classified as

4. Preferred dividend is divided for required rate of return to calculate

value of number of shares
value of equity
value of preferred stock
value of common stock

Detailed SolutionPreferred dividend is divided for required rate of return to calculate

5. Banks such as Bank of America serves a range of savers and borrowers are classified as

transfer banks
commercial banks
serving banks
nation's banks

Detailed SolutionBanks such as Bank of America serves a range of savers and borrowers are classified as

6. An interest yield = 7.9% and capital gains yield = 2.5% then total rate of return is

10.00%
3.16%
0.31%
5.40%

Detailed SolutionAn interest yield = 7.9% and capital gains yield = 2.5% then total rate of return is

7. Which of the following portfolios has the least reduction of risk?

A portfolio with securities all having positive correlation with each other
A portfolio with securities all has zero correlation with each other
A portfolio with securities all having negative correlation with each other
A portfolio with securities all has skewed correlation with each other

Detailed SolutionWhich of the following portfolios has the least reduction of risk?

8. Indifference Level of EBIT is one at which:

EPS is zero
EPS is minimum
EPS is highest
None of these

Detailed SolutionIndifference Level of EBIT is one at which:

9. Process in which managers of company identify projects to add value is classified as

capital budgeting
cost budgeting
book value budgeting
equity budgeting

Detailed SolutionProcess in which managers of company identify projects to add value is classified as

10. From the point of view of the lessee, a lease is a:

Working capital decision
Financing decision
Buy or make decision
Investment decision

Detailed SolutionFrom the point of view of the lessee, a lease is a:

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