Financial management

[amp_mcq option1=”shorter call option” option2=”longer call option” option3=”longer put option” option4=”shorter put option” correct=”option2″]

Detailed SolutionGreater value of option, larger span of time value is usually results in

[amp_mcq option1=”the expected return is smaller” option2=”the standard deviation is smaller” option3=”the stock’s price is higher” option4=”the security’s risk is higher” correct=”option4″]

Detailed SolutionIf the dispersion around a security’s return is larger ____________.

[amp_mcq option1=”going rate of return” option2=”yield” option3=”earning rate” option4=”Both A and B” correct=”option2″]

Detailed SolutionRequired rate of return in calculating bond’s cash flow is also classified as

[amp_mcq option1=”rise in marginal cost of capital” option2=”fall in marginal cost of capital” option3=”rise in transaction cost of capital” option4=”rise in transaction cost of capital” correct=”option1″]

Detailed SolutionIn large expansion programs, increased riskiness and floatation cost associated with project can cause

[amp_mcq option1=”low risky firms” option2=”high risky firms” option3=”low dividends paid” option4=”high marginal rate” correct=”option2″]

Detailed SolutionLow price for earning ratio is result of

[amp_mcq option1=”equity effects” option2=”debt effects” option3=”inflation effects” option4=”opportunity effects” correct=”option3″]

Detailed SolutionReal interest rate and real cash flows do not include

[amp_mcq option1=”European date” option2=”American date” option3=”expiration date” option4=”money date” correct=”option3″]

Detailed SolutionAt last day when European and American option can be exercised is classified as

[amp_mcq option1=”First out receivable” option2=”First in first out” option3=”Last in first out” option4=”last out receivable” correct=”option3″]

Detailed SolutionA method of inventory recording which produces high inventories in balance sheet is classified as

[amp_mcq option1=”binomial property” option2=”constant property” option3=”constant and variable property” option4=”stock” correct=”option4″]

Detailed SolutionAccording to put call parity relationship, a call option minus put option in addition with present value of exercise is equal to

[amp_mcq option1=”extrinsic stock” option2=”intrinsic stock” option3=”investing cash” option4=”free cash flow” correct=”option4″]

Detailed SolutionCash flow which is available for all investors of company is classified as