Financial management Archives - Page 5 of 112 - MCQ and Quiz for Exams

41. Stock option is more worthwhile if it is

extremely volatile

less volatile

stable stock

unstable price stock

Detailed SolutionStock option is more worthwhile if it is

42. In option pricing, an increasing in option price due to

time of expiry increases

time of expiry decreases

exchange time increases

exchange time decreases

Detailed SolutionIn option pricing, an increasing in option price due to

43. In expected rate of return for constant growth, expected total rate of return is equal to

buying pricing

dividend yield

rate of return

selling pricing

Detailed SolutionIn expected rate of return for constant growth, expected total rate of return is equal to

44. Stock with large amount of contribution of risk in a diversified portfolio is represented by

high beta and standard deviation

high beta, low standard deviation

low beta, low standard deviation

low beta, low variance

Detailed SolutionStock with large amount of contribution of risk in a diversified portfolio is represented by

45. Commercial paper is a type of:

Fixed coupon Bond

Unsecured short-term debt

Equity share capital

Government Bond

Detailed SolutionCommercial paper is a type of:

46. Type of partnership in which liabilities are limited for business owners is classified as

unlimited partnership

limited partnership

joint corporate

joint venture

Detailed SolutionType of partnership in which liabilities are limited for business owners is classified as

47. Financial security with low degree risk and investment held by businesses is classified as

treasury bills

commercial paper

negotiable certificate of deposit

money market mutual funds

Detailed SolutionFinancial security with low degree risk and investment held by businesses is classified as

48. Required return is 11% and premium for risk is 8% then risk free return will be

3.00%

19.00%

0.72%

1.38%

Detailed SolutionRequired return is 11% and premium for risk is 8% then risk free return will be

49. Minimum Rate of Return that a firm must earn in order to satisfy its investors, is also known as:

Average Return on Investment

Weighted Average Cost of Capital

Net Profit Ratio

Average Cost of borrowing

Detailed SolutionMinimum Rate of Return that a firm must earn in order to satisfy its investors, is also known as:

50. In lease system, interest is calculated on:

Cash down payment

Cash price outstanding

Hire purchase price

None of the above

Detailed SolutionIn lease system, interest is calculated on:

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