Financial management Archives - Page 3 of 112 - MCQ and Quiz for Exams

21. Residuals Theory argues that dividend is a:

Relevant Decision

Active Decision

Passive Decision

Irrelevant Decision

Detailed SolutionResiduals Theory argues that dividend is a:

22. Third step in calculating value of stock with non-constant growth rate is to find

PV of expected dividends

FV of expected dividends

PV of intrinsic rate

FV of intrinsic rate

Detailed SolutionThird step in calculating value of stock with non-constant growth rate is to find

23. Bond which is issued in market and few days are passed of its issuance is classified as

instable bond

outstanding bond

standing bond

stable bond

Detailed SolutionBond which is issued in market and few days are passed of its issuance is classified as

24. Type of bond which pays interest payment only when it earns is classified as

income bond

interest bond

payment bond

earning bond

Detailed SolutionType of bond which pays interest payment only when it earns is classified as

25. Markets in which corporations raise capital for creating market transaction which are classified as

commercial markets

residential markets

primary markets

consumer credit loans

Detailed SolutionMarkets in which corporations raise capital for creating market transaction which are classified as

26. The market price of a share of common stock is determined by ___________.

the board of directors of the firm

the stock exchange on which the stock is listed

the president of the company

individuals buying and selling the stock

Detailed SolutionThe market price of a share of common stock is determined by ___________.

27. Diversification reduces _________.

Interest rate risk

Market risk

Unique risk

Inflation risk

Detailed SolutionDiversification reduces _________.

28. Inventory Turnover measures the relationship of inventory with:

Average Sales

Cost of Goods Sold

Total Purchases

Total Assets

Detailed SolutionInventory Turnover measures the relationship of inventory with:

29. Which of the following argues that the value of levered firm is higher than that of the unlevered firm?

Net Income Approach

Net Operating Income Approach

MM Model with Taxes

Both A and C

Detailed SolutionWhich of the following argues that the value of levered firm is higher than that of the unlevered firm?

30. Type of provision which allows an orderly retirement of an issued bond which is classified as

whole call provision

super fund provision

floating fund provision

sinking fund provision

Detailed SolutionType of provision which allows an orderly retirement of an issued bond which is classified as

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