Financial management Archives

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:

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