Which method of capital budgeting called benefit cash ratio?
A. | Pay back period |
B. | Net present value |
C. | Pay out period |
D. | Profitability Index Number |
Option: D Explanation : Click on Discuss to view users comments. |
If cash inflows are not uniform, the calculation of pay-back period takes a
A. | Common Profit |
B. | Favourable Position |
C. | Cumulative Form |
D. | All of the above |
Option: C Explanation : Click on Discuss to view users comments. |
The investment proposal with the greatest relative risk would have
A. | the highest standard deviation of net present value. |
B. | the highest coefficient of variation of net present value. |
C. | the highest expected value of net present value. |
D. | the lowest opportunity loss likelihood. |
Option: B Explanation : Click on Discuss to view users comments. |
Degree of Financial leverage is
A. | Profit/Sales x Capital |
B. | Percentages change in EPS or EBIT/percentage changes in EBIT - Interest |
C. | Sales/Fixed Assets |
D. | EBIT/100 x Sales |
Option: B Explanation : Click on Discuss to view users comments. |
The "information effect" refers to the notion that
A. | a corporation's actions may convey information about its future prospects. |
B. | management is reluctant to provide financial information that is not required by law. |
C. | agents incur costs in trying to obtain information. |
D. | the financial manager should attempt to manage sensitive information about the firm. |
Option: A Explanation : Click on Discuss to view users comments. |