Business Finance MCQs

Which of the following statements are true on wealth maximization? (i) It takes into account the long-term approach. (ii) It recognizesthe risk of uncertainty. (iii) It takes into account the time value of money. (iv) It takes into account the returns. (v) It ignores stock market prices.

If a firm moves from a 'conservative' working capital policy to an 'aggressive' policy, it should expect

A multinational company that is faced with mild interference upto complete confiscation of all assets is encountering

External source of finance do not include

A company has issued 10% perpetual debt of Rs. 1 lac at 5% premium. If the tax rate is 30%, then the cost of debt will be

Under a flexible exchange rate regime, governments can retain monetary policy independence because the external balance will be achieved by

In contrast to the capital asset pricing model, arbitrage pricing theory

Discounted cash flow criteria for investment appraisal does not include

Match the following. List-I (Measurements of Cost of Capital) List-II (Features) a. Cost of debt 1. Its calculation is relatively difficult task b. Cost of preference share capital 2. The amount of interest payment should be matched with the net cash proceeds of the debt c. Cost of equity share capital 3. The shareholders have to incur some brokerage cost for investing the dividends received d. Cost of retained earnings 4. The rate of dividend payable on these shares is fixed well in advance at the time of their issue