Business finance

32. Risk of a portfolio can be minimised by which one of the following?

Combining two securities having perfect positive correlation in their expected returns
Combining two securities having perfect negative correlation in their expected returns
Combining two securities having partially positive correlation in their expected returns
Combining two securities having partially negative correlation in their expected returns

Detailed SolutionRisk of a portfolio can be minimised by which one of the following?

33. Which one of the following combination of rules stands true while preparing schedule of changes in working capital? 1. An increase in current assets increases working capital. 2. An increase in current assets decreases working capital. 3. An increase in current liabilities decreases working capital. 4. An increase in current liabilities increases working capital.

Both 1 and 4
Both 1 and 3
Both 2 and 3
Both 3 and 4

Detailed SolutionWhich one of the following combination of rules stands true while preparing schedule of changes in working capital? 1. An increase in current assets increases working capital. 2. An increase in current assets decreases working capital. 3. An increase in current liabilities decreases working capital. 4. An increase in current liabilities increases working capital.

40. Which one of the following statement is false?

Effective dividend policy is an important tool to achieve the goal of wealth maximisation
According to Walter, the optimal payout ratio for a growth firm is 100%
MM model asserts that the value of the firm is not affected whether the firm pays dividend or not
Bird-in-the-hand theory' in reference to dividend decision has been developed by Myron Gordon

Detailed SolutionWhich one of the following statement is false?

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