Financial management

41. Working Capital Turnover measures the relationship of Working Capital with:

Fixed Assets
Sales
Purchases
Stock

Detailed SolutionWorking Capital Turnover measures the relationship of Working Capital with:

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42. If retention rate is 0.68 then payout rate will be

1.47
1.68
0.32
0.68

Detailed SolutionIf retention rate is 0.68 then payout rate will be

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43. Low default-risk security issued by financially secure firms is classified as

U.S treasury bills
commercial paper
certificate of deposit
mutual funds

Detailed SolutionLow default-risk security issued by financially secure firms is classified as

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44. An amount invested is Rs 1500 and an amount received is Rs 2000 then return would be

Rs 500.00
-Rs 500.00
Rs 3,500.00
-Rs 3,500.00

Detailed SolutionAn amount invested is Rs 1500 and an amount received is Rs 2000 then return would be

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45. An excess of actual price of option over an exercise value of option is classified as

time value options
actual options
estimated options
optional pricing

Detailed SolutionAn excess of actual price of option over an exercise value of option is classified as

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46. Financial security issued by banks operating outside U.S is classified as

dollar bonds
euro deposits
Eurodollar market deposits
euro bonds

Detailed SolutionFinancial security issued by banks operating outside U.S is classified as

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47. Total common equity Rs 996,000,000 and shares outstanding 50,000,000 then book value per share would be

Rs 0.05
Rs 15.00
Rs 19.92
Rs 14.00

Detailed SolutionTotal common equity Rs 996,000,000 and shares outstanding 50,000,000 then book value per share would be

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48. Under which of the following approaches cost of equity capital is assumed to be constant with the change in leverage?

Net income approach
Modigliani and Miller approach
Net operating income approach
Traditional approach

Detailed SolutionUnder which of the following approaches cost of equity capital is assumed to be constant with the change in leverage?

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49. Cost of common stock is 15% and bond yield is 10.5% then bond risk premium will be

1.43%
8.50%
25.50%
4.50%

Detailed SolutionCost of common stock is 15% and bond yield is 10.5% then bond risk premium will be

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50. A company sells its stock shares for raising more equity capital is classified as

dealer communication offering
seasoned equity offering
electronic equity offering
electronic order offering

Detailed SolutionA company sells its stock shares for raising more equity capital is classified as

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