[amp_mcq option1=”sensitivity of EBIT with respect of % change with respect to output” option2=”% variation in the level of production” option3=”sensitivity of EPS with respect to % change in level of EBIT” option4=”no change with EBIT and EPS” correct=”option3″]
Financial management
22. Another name for stock brokers is______________.
[amp_mcq option1=”specialists” option2=”registered representatives” option3=”security analysts” option4=”portfolio managers” correct=”option2″]
Detailed SolutionAnother name for stock brokers is______________.
23. Bonds issued by corporations and exposed to default risk are classified as
[amp_mcq option1=”corporation bonds” option2=”default bonds” option3=”risk bonds” option4=”zero risk bonds” correct=”option2″]
Detailed SolutionBonds issued by corporations and exposed to default risk are classified as
24. ____________dividend promises to pay shareholders at future date
[amp_mcq option1=”Scrip” option2=”Cash” option3=”Stock” option4=”Property” correct=”option2″]
Detailed Solution____________dividend promises to pay shareholders at future date
25. The rational expectations model of dividend policy says that ______________.
[amp_mcq option1=”Since the expectations of the investors are always rational, there will be no effect of dividend policy on the valuation of the firm” option2=”If the investors have rational expectations, they will value a dividend paying firm higher than a non-dividend paying firm” option3=”If the declared dividend is in line with expectations of the investors, there will be no effect on the valuation of the firm” option4=”If the declared dividend is in accordance with the expectations, the change in the firms value will be minimal” correct=”option3″]
Detailed SolutionThe rational expectations model of dividend policy says that ______________.
26. The Transaction Motive for holding cash is for:
[amp_mcq option1=”Safety Cushion” option2=”Daily Operations” option3=”Purchase of Assets” option4=”Payment of Dividends” correct=”option2″]
Detailed SolutionThe Transaction Motive for holding cash is for:
27. Preferred dividend is Rs 60 and required rate of return is 20% then value of preferred stock will be
[amp_mcq option1=”Rs 40.00″ option2=”Rs 120.00″ option3=”Rs 12.00″ option4=”Rs 300.00″ correct=”option1″]
28. Which of the following is not a generally accepted approach for Calculation of Cost of Equity?
[amp_mcq option1=”CAPM” option2=”Dividend Discount Model” option3=”Rate of Pref. Dividend plus Risk” option4=”Price-Earnings Ratio” correct=”option4″]
29. An unsystematic risk which can be eliminated but market risk is the
[amp_mcq option1=”aggregate risk” option2=”remaining risk” option3=”effective risk” option4=”ineffective risk” correct=”option1″]
Detailed SolutionAn unsystematic risk which can be eliminated but market risk is the
30. Which of the following is not applicable to commercial paper:
[amp_mcq option1=”Face Value” option2=”Issue Price” option3=”Coupon Rate” option4=”None of the above” correct=”option3″]
Detailed SolutionWhich of the following is not applicable to commercial paper: