Financial management

41. Situation in which one project is accepted while rejecting another project in comparison is classified as

present value consent
mutually exclusive
mutual project
mutual consent

Detailed SolutionSituation in which one project is accepted while rejecting another project in comparison is classified as

42. In Corporation characteristics, losses are subject to funds invested actually is considered as

limited liability
unlimited liability
general liability
controlled ownership liability

Detailed SolutionIn Corporation characteristics, losses are subject to funds invested actually is considered as

43. If ke = r, then under Walter’s Model, which of the following is irrelevant?

Earnings per share
Dividend per share
DP Ratio
None of the above

Detailed SolutionIf ke = r, then under Walter’s Model, which of the following is irrelevant?

44. Risk in Capital budgeting implies that the decision-maker knows . . . . . . . . of the cash flows.

Variability
Probability
Certainty
None of the above

Detailed SolutionRisk in Capital budgeting implies that the decision-maker knows . . . . . . . . of the cash flows.

45. Relationship between total risk of stock, diversifiable risk and market risk is classified as

total risk
standard deviation
standard alpha
treynor alpha

Detailed SolutionRelationship between total risk of stock, diversifiable risk and market risk is classified as

46. Standard deviation is 18% and expected return is 15.5% then coefficient of variation would be

0.86%
1.16%
2.50%
-2.50%

Detailed SolutionStandard deviation is 18% and expected return is 15.5% then coefficient of variation would be

47. Chance of happening any unfavourable event in near future is classified as

chance
event happening
probability
risk

Detailed SolutionChance of happening any unfavourable event in near future is classified as

48. Retained earnings are ?

an indication of a company's liquidity
the same as cash in the bank
not important when determining dividends
the cumulative earnings of the company after dividends.

Detailed SolutionRetained earnings are ?

49. An effect of interest rate risk and investment risk on a bond’s yield is classified as

reinvestment premium
investment risk premium
maturity risk premium
defaulter's premium

Detailed SolutionAn effect of interest rate risk and investment risk on a bond’s yield is classified as

50. In which of the following sections of a balance sheet are “Inventories” listed?

Current assets
Property, plant and equipment, at cost
Current liabilities
Shareholders' Equity

Detailed SolutionIn which of the following sections of a balance sheet are “Inventories” listed?

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