The relationship between the cost of equity and financial leverage in accordance with MM proposition II can be expressed by
| A. | R = Equity/100 |
| B. | R = Equity/Debt x 100 |
| C. | rE = r0 + (r0 - rD)(1 - TC) |
| D. | R = Equity/Income |
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Option: C Explanation : Click on Discuss to view users comments. |
The call-option value of a callable bond is likely to be high when
| A. | interest rates are volatile. |
| B. | interest rates are low and expected to remain low. |
| C. | interest rate are high and expected to remain high. |
| D. | markets are inefficient. |
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Option: A Explanation : Click on Discuss to view users comments. |
A project's profitability index is equal to the ratio of the _______ of a project's future cash flows to the project's ______.
| A. | present value; initial cash outlay |
| B. | net present value; initial cash outlay |
| C. | present value; depreciable basis |
| D. | net present value; depreciable basis |
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Option: A Explanation : Click on Discuss to view users comments. |
Earning Yield computed by
| A. | EPS/Current Market Price Per Share |
| B. | Paid up value of Share/100 |
| C. | EPS/Profit x 100 |
| D. | EPS/Market Price |
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Option: A Explanation : Click on Discuss to view users comments. |
Match the following
List-I (Items) List-II (Features)
(A) Capital budgeting decision 1. Fixed Assets
(B) Cash Position Ratio 2. Liquid Ratio
(C) EOQ 3. Inventory Control
(D) Cost of Capital 4. Issue Expenses
5. Planning
| A. | (A) (B) (C) (D) 5 1 4 3 |
| B. | (A) (B) (C) (D) 3 1 4 2 |
| C. | (A) (B) (C) (D) 1 2 3 4 |
| D. | (A) (B) (C) (D) 1 3 2 4 |
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Option: C Explanation : Click on Discuss to view users comments. |
