[amp_mcq option1=”pessimistic” option2=”optimistic” option3=”experienced” option4=”inexperienced” correct=”option1″]
Financial management
22. Between two capital plans, if expected EBIT is more than indifference level of EBIT, then:
[amp_mcq option1=”Both plans be rejected” option2=”Both plans are good” option3=”One is better than other” option4=”None of the above” correct=”option3″]
23. Bonds with deferred call have protection which is classified as
[amp_mcq option1=”provision protection” option2=”provision protection” option3=”deferred protection” option4=”call protection” correct=”option4″]
Detailed SolutionBonds with deferred call have protection which is classified as
24. Cost of common stock is 16% and bond yield is 9% then bond risk premium would be
[amp_mcq option1=”7.00%” option2=”9.00%” option3=”1.78%” option4=”25.00%” correct=”option1″]
Detailed SolutionCost of common stock is 16% and bond yield is 9% then bond risk premium would be
25. Constant growth rate is 6.5% and an expected dividend yield is 3.4% then an expected rate of return would be
[amp_mcq option1=”9.90%” option2=”10.00%” option3=”3.10%” option4=”19.12%” correct=”option1″]
26. A formula of after-tax component cost of debt is
[amp_mcq option1=”interest rate-tax savings” option2=”marginal tax-required return” option3=”interest rate + tax savings” option4=”borrowing cost + embedded cost” correct=”option3″]
Detailed SolutionA formula of after-tax component cost of debt is
27. Combined leverage can be used to measure the relationship between:
[amp_mcq option1=”EBIT and EPS” option2=”PAT and EPS” option3=”Sales and EPS” option4=”Sales and EBIT” correct=”option1″]
Detailed SolutionCombined leverage can be used to measure the relationship between:
28. The available capital funds are to be carefully allocated among competing projects by careful prioritization. This is called ____________.
[amp_mcq option1=”capital positioning” option2=”capital structuring” option3=”capital rationing” option4=”capital budgeting” correct=”option4″]
29. Constant growth rate is 7.2% and an expected rate of return is 12.5% then expected dividend yield will be
[amp_mcq option1=”5.30%” option2=”19.70%” option3=”-5.30%” option4=”17.36%” correct=”option1″]
30. A type of security payment in which payments are made at equal intervals of time and each payment amount is same is classified as
[amp_mcq option1=”fixed interval investment” option2=”fixed payment investment” option3=”annuity” option4=”lump sum amount” correct=”option3″]