Business Finance MCQs

The conflicts in project ranking in capital budgeting as per NPV and IRR may arise because of

What are the main objectives of financing decision? 1. To get optimal working capital figure. 2. To get optimal capital structure. 3. To make the company exposed to high risk. 4. To keep the cost of capital lowest. 5. To make the value of share highest.

Assertion (A): The important aspect of dividend policy is to determine the amount of earnings to be distributed to shareholders and the amount to be retained in the firm. Reason (R): Dividend policy of the firm has its effect on both the long term financing and the wealth of shareholders.

Who proposed a model to apply economic order quantity concept of inventory mangement to determine the optimum cash holding in a firm?

The cost of capital from all the sources of funds is called

Which of the following concepts deals with discounted cash flows?

Which of the following are the main features of Zero Coupon Bonds? 1. They are called deep discount bonds. 2. The price paid by investors is less than their face value. 3. The bonds are redeemed at par.

Which combination of the following represents the assumptions of the Walter's dividend model? 1.The company has a very long or perpetual life. 2. All earnings are either reinvested intemally or distributed as dividend. 3. There is no floatation cost for the company. 4. Cost of capital of the company is constant. Select the correct one:

Which one of the following is not the internal factor affecting the weighted average cost of capital of a firm?