Question # 1 of 15 ( Start time: 09:28:53 AM ) Total Marks: 1
Which of the following could NOT be defined as the capital structure of the Company?
Select correct option:
The firm's mix of Assets and liabilities
The firm's common stocks only
The firm's debt-equity ratio
All of the given options
Question # 2 of 15 ( Start time: 09:29:41 AM ) Total Marks: 1
Which of the following is NOT an example of hybrid equity
Select correct option:
Convertible Bonds
Convertible Debenture
Common shares
Preferred shares
Which of the following could NOT be defined as the capital structure of the Company?
Select correct option:
The firm's mix of Assets and liabilities
The firm's common stocks only
The firm's debt-equity ratio
All of the given options
Question # 2 of 15 ( Start time: 09:29:41 AM ) Total Marks: 1
Which of the following is NOT an example of hybrid equity
Select correct option:
Convertible Bonds
Convertible Debenture
Common shares
Preferred shares
3
Question # 3 of 15 ( Start time: 09:30:15 AM ) Total Marks: 1
Which of the following should be included while calculating the cash flows associated with a project?
Select correct option:
Cash flows at the time of investment
Cash flows during the life of project
Cash flows at the termination date
All of the given options
Question # 3 of 15 ( Start time: 09:30:15 AM ) Total Marks: 1
Which of the following should be included while calculating the cash flows associated with a project?
Select correct option:
Cash flows at the time of investment
Cash flows during the life of project
Cash flows at the termination date
All of the given options
Not confirm
Question # 4 of 15 ( Start time: 09:31:28 AM ) Total Marks: 1
Which of the following is type a Temporary Account?
Select correct option:
Asset
Liability
Reserves
Revenue
Which of the following is type a Temporary Account?
Select correct option:
Asset
Liability
Reserves
Revenue
4
Question # 5 of 15 ( Start time: 09:31:56 AM ) Total Marks: 1
The overall (weighted average) cost of capital is composed of weighted averages of which of the following?
Select correct option:
The cost of common equity and the cost of debt
The cost of common equity and the cost of preferred stock
The cost of preferred stock and the cost of debt
The cost of common equity, the cost of preferred stock, and the cost of debt
The overall (weighted average) cost of capital is composed of weighted averages of which of the following?
Select correct option:
The cost of common equity and the cost of debt
The cost of common equity and the cost of preferred stock
The cost of preferred stock and the cost of debt
The cost of common equity, the cost of preferred stock, and the cost of debt
4
Question # 6 of 15 ( Start time: 09:32:46 AM ) Total Marks: 1
Which of the following could be defined as the capital structure of the Company?
Select correct option:
The firm's mix of different securities
The firm's debt-equity ratio
The market imperfection that the firm's manager can exploit
All of the above
Question # 6 of 15 ( Start time: 09:32:46 AM ) Total Marks: 1
Which of the following could be defined as the capital structure of the Company?
Select correct option:
The firm's mix of different securities
The firm's debt-equity ratio
The market imperfection that the firm's manager can exploit
All of the above
2
Question # 7 of 15 ( Start time: 09:33:13 AM ) Total Marks: 1
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
3
Question # 8 of 15 ( Start time: 09:33:52 AM ) Total Marks: 1
Consider two bonds, A and B. Both bonds presently are selling at their par value of Rs. 1,000. Each pays interest of Rs. 120 annually. Bond A will mature in 5 years while bond B will mature in 6 years. If the yields to maturity on the two bonds change from 12% to 10%, __________.
Select correct option:
Both bonds will increase in value, but bond A will increase more than bond B
Both bonds will increase in value, but bond B will increase more than bond A
Both bonds will decrease in value, but bond A will decrease more than bond B
Both bonds will decrease in value, but bond B will decrease more than bond A
Consider two bonds, A and B. Both bonds presently are selling at their par value of Rs. 1,000. Each pays interest of Rs. 120 annually. Bond A will mature in 5 years while bond B will mature in 6 years. If the yields to maturity on the two bonds change from 12% to 10%, __________.
Select correct option:
Both bonds will increase in value, but bond A will increase more than bond B
Both bonds will increase in value, but bond B will increase more than bond A
Both bonds will decrease in value, but bond A will decrease more than bond B
Both bonds will decrease in value, but bond B will decrease more than bond A
2
Question # 9 of 15 ( Start time: 09:34:26 AM ) Total Marks: 1
The explicit costs associated with corporate default, such as legal expenses, are the _________ of the firm.
Select correct option:
Flotation costs
Default beta coefficients
Direct bankruptcy costs
Indirect bankruptcy costs
The explicit costs associated with corporate default, such as legal expenses, are the _________ of the firm.
Select correct option:
Flotation costs
Default beta coefficients
Direct bankruptcy costs
Indirect bankruptcy costs
3
Question # 10 of 15 ( Start time: 09:35:00 AM ) Total Marks: 1
Which of the following portfolio statistics statements is correct?
Select correct option:
A portfolio's expected return is a simple weighted average of expected returns of the individual securities comprising the portfolio.
A portfolio's standard deviation of return is a simple weighted average of individual security return standard deviations.
The square root of a portfolio's standard deviation of return equals its variance.
The square root of a portfolio's standard deviation of return equals its coefficient of variation.
Which of the following portfolio statistics statements is correct?
Select correct option:
A portfolio's expected return is a simple weighted average of expected returns of the individual securities comprising the portfolio.
A portfolio's standard deviation of return is a simple weighted average of individual security return standard deviations.
The square root of a portfolio's standard deviation of return equals its variance.
The square root of a portfolio's standard deviation of return equals its coefficient of variation.
1
Question # 11 of 15 ( Start time: 09:35:39 AM ) Total Marks: 1
Calculate the break-even point for sales revenues given the following information. The firm has Rs.1, 000,000 in fixed costs. The firm anticipates that variable costs will be Rs.1 for every Rs.5 in sales.
Select correct option:
Rs.1, 250,000
Rs.1, 000,000
Rs.250, 000
Rs.200, 000
Calculate the break-even point for sales revenues given the following information. The firm has Rs.1, 000,000 in fixed costs. The firm anticipates that variable costs will be Rs.1 for every Rs.5 in sales.
Select correct option:
Rs.1, 250,000
Rs.1, 000,000
Rs.250, 000
Rs.200, 000
1
Question # 12 of 15 ( Start time: 09:36:02 AM ) Total Marks: 1
Which of the following equation is NOT correct?
Select correct option:
Gross Revenue – Admin & Operating Expenses = Operating Revenue
Other Expenses + Other Revenue = EBIT
EBIT – Financial Charges & Interest = EBT
Net Income – Dividends = Retained Earning
Which of the following equation is NOT correct?
Select correct option:
Gross Revenue – Admin & Operating Expenses = Operating Revenue
Other Expenses + Other Revenue = EBIT
EBIT – Financial Charges & Interest = EBT
Net Income – Dividends = Retained Earning
2
Question # 13 of 15 ( Start time: 09:36:40 AM ) Total Marks: 1
If 2 stocks move in the same direction together then what will be the correlation coefficient?
Select correct option:
0
1.0
-1.0
1.5
If 2 stocks move in the same direction together then what will be the correlation coefficient?
Select correct option:
0
1.0
-1.0
1.5
2
Question # 14 of 15 ( Start time: 09:37:02 AM ) Total Marks: 1
Which of the following is NOT an example of a financial intermediary?
Select correct option:
Wisconsin S&L, a savings and loan association
Strong Capital Appreciation, a mutual fund
Microsoft Corporation, a software firm
College Credit, a credit union
Which of the following is NOT an example of a financial intermediary?
Select correct option:
Strong Capital Appreciation, a mutual fund
Microsoft Corporation, a software firm
College Credit, a credit union
3
Question # 15 of 15 ( Start time: 09:37:29 AM ) Total Marks: 1
Which of the following could be taken same as minimizing the weighted average cost of capital?
Select correct option:
Maximizing the market value of the firm
Maximizing the market value of the firm only if MM's Proposition I
Minimizing the market value of the firm only if MM's Proposition I holds
Maximizing the profits of the firm
Which of the following could be taken same as minimizing the weighted average cost of capital?
Select correct option:
Maximizing the market value of the firm
Maximizing the market value of the firm only if MM's Proposition I
Minimizing the market value of the firm only if MM's Proposition I holds
Maximizing the profits of the firm
3
Sent at 9:37 AM on Wednesday
Quiz Start Time: 09:42 AM
Time Left 75
sec(s)
Question # 2 of 15 ( Start time: 09:49:39 AM ) Total Marks: 1
Which of the following is the maximum amount of debt (and other fixed-charge financing) that a firm can adequately service?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
Time Left 75
sec(s)
Question # 2 of 15 ( Start time: 09:49:39 AM ) Total Marks: 1
Which of the following is the maximum amount of debt (and other fixed-charge financing) that a firm can adequately service?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
1
Quiz Start Time: 09:42 AM
Time Left 76
sec(s)
Question # 6 of 15 ( Start time: 09:53:17 AM ) Total Marks: 1
An arbitrage opportunity exists if an investor can construct a ________ investment portfolio that will yield a sure profit.
Select correct option:
Positive
Negative
Zero
All of the above
Time Left 76
sec(s)
Question # 6 of 15 ( Start time: 09:53:17 AM ) Total Marks: 1
An arbitrage opportunity exists if an investor can construct a ________ investment portfolio that will yield a sure profit.
Select correct option:
Positive
Negative
Zero
All of the above
3
Question # 7 of 15 ( Start time: 09:53:43 AM ) Total Marks: 1
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
3
Question # 8 of 15 ( Start time: 09:54:06 AM ) Total Marks: 1
Which of the following is the maximum amount of debt (and other fixed-charge financing) that a firm can adequately service?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
Which of the following is the maximum amount of debt (and other fixed-charge financing) that a firm can adequately service?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
1
Question # 9 of 15 ( Start time: 09:54:27 AM ) Total Marks: 1
Where the stock points will lie, if a stock is a part of totally diversified portfolio?
Select correct option:
It will lie below the regression line
It will line above the regression line
It will line exactly on the regression line
It will be tangent to the regression line
Where the stock points will lie, if a stock is a part of totally diversified portfolio?
Select correct option:
It will lie below the regression line
It will line above the regression line
It will line exactly on the regression line
It will be tangent to the regression line
3
Question # 10 of 15 ( Start time: 09:54:55 AM ) Total Marks: 1
A set of possible values that a random variable can assume and their associated probabilities of occurrence are referred to as ________.
Select correct option:
Probability distribution
The expected return
The standard deviation
Coefficient of variation
A set of possible values that a random variable can assume and their associated probabilities of occurrence are referred to as ________.
Select correct option:
Probability distribution
The expected return
The standard deviation
Coefficient of variation
1
Question # 11 of 15 ( Start time: 09:55:20 AM ) Total Marks: 1
The ________ the coefficient of variation ______ the relative risk of the investment.
Select correct option:
Larger; Larger
Larger; Smaller
Smaller; Larger
Smaller; Smaller
The ________ the coefficient of variation ______ the relative risk of the investment.
Select correct option:
Larger; Larger
Larger; Smaller
Smaller; Larger
Smaller; Smaller
1
Question # 12 of 15 ( Start time: 09:55:40 AM ) Total Marks: 1
You are considering two investment proposals, project A and project B. B's expected net present value is Rs. 1,000 greater than that for A and A's dispersion of net present value is less than that for B. On the basis of risk and return, what would be your conclusion?
Select correct option:
Project A dominates project B
Project B dominates project A
Neither project dominates the other in terms of risk and return
Incomplete information
You are considering two investment proposals, project A and project B. B's expected net present value is Rs. 1,000 greater than that for A and A's dispersion of net present value is less than that for B. On the basis of risk and return, what would be your conclusion?
Select correct option:
Project A dominates project B
Project B dominates project A
Neither project dominates the other in terms of risk and return
Incomplete information
3
Question # 13 of 15 ( Start time: 09:55:58 AM ) Total Marks: 1
Which of the following could be taken same as minimizing the weighted average cost of capital?
Select correct option:
Maximizing the market value of the firm
Maximizing the market value of the firm only if MM's Proposition I
Minimizing the market value of the firm only if MM's Proposition I holds
Maximizing the profits of the firm
Which of the following could be taken same as minimizing the weighted average cost of capital?
Select correct option:
Maximizing the market value of the firm
Maximizing the market value of the firm only if MM's Proposition I
Minimizing the market value of the firm only if MM's Proposition I holds
Maximizing the profits of the firm
3
Question # 14 of 15 ( Start time: 09:56:22 AM ) Total Marks: 1
Which of the following statements is TRUE regarding Permanent Accounts?
Select correct option:
Accounts that are found on Income Statement
Accounts that are found on Statement of Retained Earnings
Accounts that are found on Balance Sheet
All of the given options
Which of the following statements is TRUE regarding Permanent Accounts?
Select correct option:
Accounts that are found on Income Statement
Accounts that are found on Statement of Retained Earnings
Accounts that are found on Balance Sheet
All of the given options
3
Question # 15 of 15 ( Start time: 09:56:49 AM ) Total Marks: 1
Why companies invest in projects with negative NPV?
Select correct option:
Because there is hidden value in each project
Because there may be chance of rapid growth
Because they have invested a lot
All of the given options
Why companies invest in projects with negative NPV?
Select correct option:
Because there is hidden value in each project
Because there may be chance of rapid growth
Because they have invested a lot
All of the given options
1
Question # 1 of 15 ( Start time: 09:59:57 AM ) Total Marks: 1
Total portfolio risk is ________.
Select correct option:
Equal to systematic risk plus non-diversifiable risk
Equal to avoidable risk plus diversifiable risk
Equal to systematic risk plus unavoidable risk
Equal to systematic risk plus diversifiable risk
Total portfolio risk is ________.
Select correct option:
Equal to systematic risk plus non-diversifiable risk
Equal to avoidable risk plus diversifiable risk
Equal to systematic risk plus unavoidable risk
Equal to systematic risk plus diversifiable risk
4
Question # 2 of 15 ( Start time: 10:00:52 AM ) Total Marks: 1
A statistical measure of the variability of a distribution around its mean is referred to as ________.
Select correct option:
Probability distribution
Expected return
Standard deviation
Coefficient of variation
A statistical measure of the variability of a distribution around its mean is referred to as ________.
Select correct option:
Probability distribution
Expected return
Standard deviation
Coefficient of variation
3
Question # 3 of 15 ( Start time: 10:01:18 AM ) Total Marks: 1
Who or what is a person or institution designated by a bond issuer as the official representative of the bondholders?
Select correct option:
Indenture
Debenture
Bond
Bond trustee4
Who or what is a person or institution designated by a bond issuer as the official representative of the bondholders?
Select correct option:
Indenture
Debenture
Bond
Bond trustee4
Question # 4 of 15 ( Start time: 10:01:39 AM ) Total Marks: 1
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
Upon which of the following a firm's degree of operating leverage (DOL) depends primarily?
Select correct option:
Sales variability
Level of fixed operating costs
Closeness to its operating break-even point
Debt-to-equity ratio
3
Question # 5 of 15 ( Start time: 10:02:00 AM ) Total Marks: 1
The ________ the coefficient of variation ______ the relative risk of the investment.
Select correct option:
Larger; Larger
Larger; Smaller
Smaller; Larger
Smaller; Smaller
The ________ the coefficient of variation ______ the relative risk of the investment.
Select correct option:
Larger; Larger
Larger; Smaller
Smaller; Larger
Smaller; Smaller
1
Question # 6 of 15 ( Start time: 10:02:23 AM ) Total Marks: 1
Which of the following is type a Temporary Account?
Select correct option:
Asset
Liability
Reserves
Revenue
Which of the following is type a Temporary Account?
Select correct option:
Asset
Liability
Reserves
Revenue
4
Question # 7 of 15 ( Start time: 10:02:50 AM ) Total Marks: 1
What should be the focal point of financial management in a firm?
Select correct option:
The number and types of products or services provided by the firm
The minimization of the amount of taxes paid by the firm
The creation of value for shareholders
The dollars profits earned by the firm
What should be the focal point of financial management in a firm?
Select correct option:
The number and types of products or services provided by the firm
The minimization of the amount of taxes paid by the firm
The creation of value for shareholders
The dollars profits earned by the firm
3
Question # 8 of 15 ( Start time: 10:03:13 AM ) Total Marks: 1
Where the stock points will lie, if a stock is a part of totally diversified portfolio?
Select correct option:
It will lie below the regression line
It will line above the regression line
It will line exactly on the regression line
It will be tangent to the regression line
Where the stock points will lie, if a stock is a part of totally diversified portfolio?
Select correct option:
It will lie below the regression line
It will line above the regression line
It will line exactly on the regression line
It will be tangent to the regression line
3
Question # 9 of 15 ( Start time: 10:03:35 AM ) Total Marks: 1
______ are also known as Spontaneous Financing.
Select correct option:
Current liabilities
Current assets
Fixed assets
Long-term liabilities
______ are also known as Spontaneous Financing.
Select correct option:
Current liabilities
Current assets
Fixed assets
Long-term liabilities
1
Question # 10 of 15 ( Start time: 10:03:54 AM ) Total Marks: 1
The RBS pays 5.60%, compounded daily (based on 360 days), on a 9-month certificate of deposit, if you deposit Rs.20, 000 you would expect to earn around ________ in interest.
Select correct option:
Rs.840
Rs.858
Rs.1,032
Rs.1,121
The RBS pays 5.60%, compounded daily (based on 360 days), on a 9-month certificate of deposit, if you deposit Rs.20, 000 you would expect to earn around ________ in interest.
Select correct option:
Rs.840
Rs.858
Rs.1,032
Rs.1,121
2
Question # 11 of 15 ( Start time: 10:04:13 AM ) Total Marks: 1
The logic behind _______ is that instead of looking at net cash flows you look at cash inflows and outflows separately for each point in time.
Select correct option:
IRR
MIRR
PV
NPV
The logic behind _______ is that instead of looking at net cash flows you look at cash inflows and outflows separately for each point in time.
Select correct option:
IRR
MIRR
PV
NPV
2
Question # 12 of 15 ( Start time: 10:04:33 AM ) Total Marks: 1
Which of the following factor(s) do NOT affects the movements in the market index?
Select correct option:
Macroeconomic factors
Socio political factors
Social factors
All of the given options
Which of the following factor(s) do NOT affects the movements in the market index?
Select correct option:
Macroeconomic factors
Socio political factors
Social factors
All of the given options
3
Question # 13 of 15 ( Start time: 10:04:55 AM ) Total Marks: 1
Which of the following is as EBIT?
Select correct option:
Funds provided by operations
Earnings before taxes
Net income
Operating profit
Which of the following is as EBIT?
Select correct option:
Funds provided by operations
Earnings before taxes
Net income
Operating profit
4
Question # 14 of 15 ( Start time: 10:05:13 AM ) Total Marks: 1
Which of the following refers to a policy of dividend "smoothing"?
Select correct option:
Maintaining a constant dividend payout ratio
Keeping the regular dividend at the same level indefinitely
Maintaining a steady progression of dividend increases over time
Alternating cash dividends with stock dividends
Which of the following refers to a policy of dividend "smoothing"?
Select correct option:
Maintaining a constant dividend payout ratio
Keeping the regular dividend at the same level indefinitely
Maintaining a steady progression of dividend increases over time
Alternating cash dividends with stock dividends
3
Question # 15 of 15 ( Start time: 10:05:43 AM ) Total Marks: 1
If risk and return combination of any stock is above the SML, what does it mean?
Select correct option:
It is offering lower rate of return as compared to the efficient stock
It is offering higher rate of return as compared to the efficient stock
Its rate of return is zero as compared to the efficient stock
It is offering rate of return equal to the efficient stock
If risk and return combination of any stock is above the SML, what does it mean?
Select correct option:
It is offering lower rate of return as compared to the efficient stock
It is offering higher rate of return as compared to the efficient stock
Its rate of return is zero as compared to the efficient stock
It is offering rate of return equal to the efficient stock
2
Question # 1 of 15 ( Start time: 10:10:03 AM ) Total Marks: 1
Which of the following is NOT an example of hybrid equity
Select correct option:
Convertible Bonds
Convertible Debenture
Common shares
Preferred shares
Which of the following is NOT an example of hybrid equity
Select correct option:
Convertible Bonds
Convertible Debenture
Common shares
Preferred shares
3
Question # 3 of 15 ( Start time: 10:11:00 AM ) Total Marks: 1
What should be used to calculate the proportional amount of equity financing employed by a firm?
Select correct option:
The common stock equity account on the firm's balance sheet
The sum of common stock and preferred stock on the balance sheet
The book value of the firm
The current market price per share of common stock times the number of shares Outstanding
What should be used to calculate the proportional amount of equity financing employed by a firm?
Select correct option:
The common stock equity account on the firm's balance sheet
The sum of common stock and preferred stock on the balance sheet
The book value of the firm
The current market price per share of common stock times the number of shares Outstanding
4
Question # 5 of 15 ( Start time: 10:12:23 AM ) Total Marks: 1
Which of the following is related to the use Lower financial leverage?
Select correct option:
Fixed costs
Variable costs
Debt financing
Common equity financing
Which of the following is related to the use Lower financial leverage?
Select correct option:
Fixed costs
Variable costs
Debt financing
Common equity financing
4
Question # 6 of 15 ( Start time: 10:12:46 AM ) Total Marks: 1
A 5-year ordinary annuity has a present value of Rs.1,000. If the interest rate is 8 percent, the amount of each annuity payment is closest to which of the following?
Select correct option:
Rs. 250.44
Rs. 231.91
Rs.181.62
Rs.184.08
A 5-year ordinary annuity has a present value of Rs.1,000. If the interest rate is 8 percent, the amount of each annuity payment is closest to which of the following?
Select correct option:
Rs. 250.44
Rs. 231.91
Rs.181.62
Rs.184.08
1
Question # 7 of 15 ( Start time: 10:13:08 AM ) Total Marks: 1
The objective of financial management is to maximize _______ wealth.
Select correct option:
Stakeholders
Shareholders
Bondholders
Directors
The objective of financial management is to maximize _______ wealth.
Select correct option:
Stakeholders
Shareholders
Bondholders
Directors
2
Question # 8 of 15 ( Start time: 10:13:32 AM ) Total Marks: 1
Which of the following stipulate a relationship between expected return and risk?
Select correct option:
APT stipulates
CAPM stipulates
Both CAPM and APT stipulate
Neither CAPM nor APT stipulate
Which of the following stipulate a relationship between expected return and risk?
Select correct option:
APT stipulates
CAPM stipulates
Both CAPM and APT stipulate
Neither CAPM nor APT stipulate
3
Question # 9 of 15 ( Start time: 10:13:51 AM ) Total Marks: 1
Which type of responsibilities are primarily assigned to Controller and Treasurer respectively?
Select correct option:
Operational; financial management
Financial management; accounting
Accounting; financial management
Financial management; operations
Which type of responsibilities are primarily assigned to Controller and Treasurer respectively?
Select correct option:
Operational; financial management
Financial management; accounting
Accounting; financial management
Financial management; operations
3
Question # 11 of 15 ( Start time: 10:14:26 AM ) Total Marks: 1
The stock in your portfolio was selling for Rs.40 per share yesterday, but has today declared a three for two split. Which of the following statements seems to be true?
Select correct option:
There will be two-thirds as many shares outstanding, and they will sell for Rs.60.00 each
There will be four times as many shares outstanding, and they will sell for Rs.160.00 each
There will be 50 percent more shares outstanding and they will sell for Rs.26.67 each
There will be one-and-one-half times as many shares outstanding, and they will sell for Rs.60.00 each
The stock in your portfolio was selling for Rs.40 per share yesterday, but has today declared a three for two split. Which of the following statements seems to be true?
Select correct option:
There will be two-thirds as many shares outstanding, and they will sell for Rs.60.00 each
There will be four times as many shares outstanding, and they will sell for Rs.160.00 each
There will be 50 percent more shares outstanding and they will sell for Rs.26.67 each
There will be one-and-one-half times as many shares outstanding, and they will sell for Rs.60.00 each
3
Question # 12 of 15 ( Start time: 10:15:01 AM ) Total Marks: 1
Which of the following is correct regarding the opportunity cost of capital for a project?
Select correct option:
The opportunity cost of capital is the return that investors give up by investing in the project rather than in securities of equivalent risk.
Financial managers use the capital asset pricing model to estimate the opportunity cost of capital
The company cost of capital is the expected rate of return demanded by investors in a company
All of the given options
Which of the following is correct regarding the opportunity cost of capital for a project?
Select correct option:
The opportunity cost of capital is the return that investors give up by investing in the project rather than in securities of equivalent risk.
Financial managers use the capital asset pricing model to estimate the opportunity cost of capital
The company cost of capital is the expected rate of return demanded by investors in a company
All of the given options
4
Question # 13 of 15 ( Start time: 10:15:20 AM ) Total Marks: 1
When taxes are considered, the value of a levered firm equals the value of the______.
Select correct option:
Unlevered firm
Unlevered firm plus the value of the debt
Unlevered firm plus the present value of the tax shield
Unlevered firm plus the value of the debt plus the value of the tax shield
When taxes are considered, the value of a levered firm equals the value of the______.
Select correct option:
Unlevered firm
Unlevered firm plus the value of the debt
Unlevered firm plus the present value of the tax shield
Unlevered firm plus the value of the debt plus the value of the tax shield
3
Question # 14 of 15 ( Start time: 10:15:50 AM ) Total Marks: 1
Which of the following is the cash required during a specific period to meet interest expenses and principal payments?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
Which of the following is the cash required during a specific period to meet interest expenses and principal payments?
Select correct option:
Debt capacity
Debt-service burden
Adequacy capacity
Fixed-charge burden
2
Question # 15 of 15 ( Start time: 10:16:14 AM ) Total Marks: 1
Nominal Interest Rate is also known as:
Select correct option:
Effective interest Rate
Annual percentage rate
Periodic interest rate
Required interest rate
Nominal Interest Rate is also known as:
Select correct option:
Effective interest Rate
Annual percentage rate
Periodic interest rate
Required interest rate
2
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