Financial management Archives - Page 2 of 112 - MCQ and Quiz for Exams

11. Greater value of option, larger span of time value is usually results in

shorter call option

longer call option

longer put option

shorter put option

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

12. If the dispersion around a security’s return is larger ____________.

the expected return is smaller

the standard deviation is smaller

the stock's price is higher

the security's risk is higher

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

13. Required rate of return in calculating bond’s cash flow is also classified as

going rate of return

yield

earning rate

Both A and B

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

14. In large expansion programs, increased riskiness and floatation cost associated with project can cause

rise in marginal cost of capital

fall in marginal cost of capital

rise in transaction cost of capital

rise in transaction cost of capital

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

15. Low price for earning ratio is result of

low risky firms

high risky firms

low dividends paid

high marginal rate

Detailed SolutionLow price for earning ratio is result of

16. Real interest rate and real cash flows do not include

equity effects

debt effects

inflation effects

opportunity effects

Detailed SolutionReal interest rate and real cash flows do not include

17. At last day when European and American option can be exercised is classified as

European date

American date

expiration date

money date

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

18. A method of inventory recording which produces high inventories in balance sheet is classified as

First out receivable

First in first out

Last in first out

last out receivable

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

19. According to put call parity relationship, a call option minus put option in addition with present value of exercise is equal to

binomial property

constant property

constant and variable property

stock

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

20. Cash flow which is available for all investors of company is classified as

extrinsic stock

intrinsic stock

investing cash

free cash flow

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

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