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

11. In Net Operating Income Approach, which one of the following is constant?

Cost of Equity

Cost of Debt

WACC & kd

ke and kd

Detailed SolutionIn Net Operating Income Approach, which one of the following is constant?

12. Third step in binomial approach of option pricing is to

equalize beginning price

equalize range of payoffs

equalize domain of payoff

equalize ending price

Detailed SolutionThird step in binomial approach of option pricing is to

13. Which of the following is not true for capital budgeting?

Sunk costs are ignored

Opportunity costs are excluded

Incremental cash flows are considered

Relevant cash flows are considered

Detailed SolutionWhich of the following is not true for capital budgeting?

14. Which of the following methods does a firm resort to avoid dividend payments?

Share splitting

Declaring bonus shares

Rights issue

New issue

Detailed SolutionWhich of the following methods does a firm resort to avoid dividend payments?

15. Financial analysts, working capital means the same thing as __________.

total assets

fixed assets

current assets

current assets minus current Liabilities

Detailed SolutionFinancial analysts, working capital means the same thing as __________.

16. Real rate of return, risk and expected inflation are primary determinants of

minimum rate of return

accepted return

expected return

real risk free rate

Detailed SolutionReal rate of return, risk and expected inflation are primary determinants of

17. Variability for expected returns for projects is classified as

expected risk

stand-alone risk

variable risk

returning risk

Detailed SolutionVariability for expected returns for projects is classified as

18. In capital budgeting, number of non-normal cash flows have internal rate of returns are

one

multiple

accepted

non-accepted

Detailed SolutionIn capital budgeting, number of non-normal cash flows have internal rate of returns are

19. In Capital Budgeting, Sunk cost is excluded because it is:

of small amount

not incremental

not reversible

All of the above

Detailed SolutionIn Capital Budgeting, Sunk cost is excluded because it is:

20. A discount rate which equals to present value of TV to project cost present value is classified as

negative internal rate of return

modified internal rate of return

existed internal rate of return

relative rate of return

Detailed SolutionA discount rate which equals to present value of TV to project cost present value is classified as

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