Q1.

The difference between present value of cash inflows and outflows is known as
NPV

Q2. Increase in the frequency of compounding results in to _________ maturity value

Higher
Q3. Arum buys a stock at rupees 20 and sells at rupees 25 after 10 months. During
this
period he receives a dividend of rupees 5 on his investments. Calculate the holding
period return
0.5
Q4. If the annual rent expense goes up, the operating leverage will _________ and
will
give rise to more than proportionate change in ___________
Increase, EBIT
Q5. Market interest rate is 9%. A bond with 10% coupon will sell ______ par value
Above
Q6. After the 2 for 1 shares split number of shares will ______?
Double
Q7. 1/10 30 credit term means
1% discount for payment within 10 days
Q8. If the face value of a bond is 100 and its redemption value is 110 bond is
maturing
at ________?
10% premium
Q9. Current year dividend of Sun limited is rupees 5 per share expected growth rate
is
8% and market capitalization rate is 10%. Calculate the intrinsic value of stock
Rs. 270
Q10. If growth rate of expected earnings goes up then price of stock will ________?
Increase
Q11. As per MM proposition without taxes value of firm is __________ by changing the
capital structure?

Not affected
Q12. Which of the following instrument is riskiest : shares, preference shares,
debentures, fixed deposit ?
Shares
Q13. If credit sales is 1,00,000 credit period is 30 days calculate the average
receivables
3333
Q14. What are the two components of holding period return
Periodic return and capital appreciation
Q15. Dividend payment linked to profits left-out after meeting the expansion needs
is
based on ________ theory/policy ?
Residual Payout Policy
Q16. In which of the following frequency of compounding present value of annuity
will be
lowest : annual, quarterly, monthly, daily
Daily
Q17. Days inventory + days sales outstanding is known as ________ ?
The Cash Conversion Cycle
Q18. If the coupon rate of a debenture is increased then its YTM will _______?
Decrease
Q19. Brexit Greece crisis Chinese crisis subprime crisis are examples of which of the
following : systematic risk, unsystematic risk, total risk, specific risk
systematic risk
Q20. If the cost of capital of a project goes up then NPV will _________?
Decrease
Q21. A tight working capital policy will lead to ________?
All of the above
Q22. When in the calculation of IRR intermittent cash flows are reinvested at
required
rate of return the resultant rate is known as
MIRR
Q23. As per MM proposition with taxes, value of unlevered firm is _______ then
levered
firms
Same
Q24. For Dairy limited beta is 0.8 nifty returns equal to 15% and T bill rate is 8%
what is
the cost of equity
13.56
Q 25. Sales of Zing limited for 2016 was rupees 10,000, CoGS Rs. 6000
depreciation
rupees 1000 interest rupees 800. Tax rate 30%. Calculate the operating cash flow of
zing
limited for 2016
2540
Q26. As per matching approach, permanent working capital requirements should be
funded by ______?
Long term funds
Q 27. Proportion of profit distributed among shareholders is known as
Payout ratio
Q 28. For A limited annual demand is 10,000 units, carrying cost is rupees two per
unit
and order cost is rupees 50. Calculate EOQ
707
Q 29. The cash flows forecasted during the projection period for capital budgeting
decisions are known as
Regular cash flow
Q 30. The stock's average return in last three years where 12% and standard
deviation is
8%. Calculate the coefficient of variation
0.67

Test 2
Q1. The relationship between security return and market return is shown by ______?
Rm-Rf
Q2. If the credit period is increased for the customers of the company operating
cycle
will ______?
Increase
Q3. Which of the following instrument is riskiest: shares, preference shares,
debentures,
fixed deposit ?
Shares
Q4. If the cost of capital of a project goes up then NPV will _________?
Decrease
Q5. _________ method tells the period in which original investment in a project will
be
recovered?
Payback period
Q6. In which of the following frequency of compounding maturity value of
investment
will be highest : annual, quarterly, monthly, daily
Daily
Q7. As per MM proposition with taxes, value of unlevered firm is _______ then
levered
firms
Higher
Q8. Shyam deposits Rs 5000 every year for next three years at 6% semi annual
compounding. Calculate the future value of investment? Future value annuity factor
at
3% for three years and six years is 3.0909 and 6.4684 respectively and at 6% for
three
years and six years is 3.1836 and 6.9753 respectively
17438.25
Q9. What will be the price of bond with face value Rs. 1000 carrying a coupon of
10%
maturity in three years at 10% premium on par value. The present value factor and
PVAF
at 10% for three years is 0.75132 and 2.4869 respictively
1000
Q10. Sheila needs rupees 5,00,000 at the end of five years. How much amount she
should invest right now at 10%. The present value of ₹1 at 10% for five years
is .6209
310450
Q11. Stocks average return in last three years were 12% and standard deviation is
8%,
Calculate the coefficient of variation
0.67
Q12. If the annual rent expense goes up, the operating leverage will _________ and
will
give rise to more than proportionate change in ___________
Increase, EBIT
Q 13. Proportion of profit distributed among shareholders is known as
Payout ratio
Q14. In which of the following frequency of compounding present value of annuity
will be
lowest : annual, quarterly, monthly, daily
Daily
Q15. Which of the following costs is important while evaluating the investment
decisions
: sunk cost, incremental cost, both of the above and none of the above
Incremental cost
Q16. Stream of equal cash flows at regular interval is known as
Annuity
Q17. If proportion of debt is increased in Capital structure, overall cost of capital will
________?
Decrease
Q18. For A limited annual demand is 10,000 units, carrying cost is rupees two per
unit
and order cost is rupees 50. Calculate EOQ
707
Q19. For projects with different scales which of the evaluation techniques should be
used: NPV, IRR, pay-back period and profitability index
NPV
Q20. A company replaces an old machinery with salvage value of rupees 1,00,000
replaced by a machinery costing rupees 5 Lac. The relevant cash flows for
evaluation of
this project is
4lac
Q21. For Dairy limited beta is 0.8 nifty returns equal to 15% and T bill rate is 8%
what is
the cost of equity
13.56
Q22. If the credit period is increased by the suppliers of the company's cash
conversion
cycle will _____?
Reduce
Q23. As per bird in hand theory high dividend payout is _______ to low payout?
Options
are preferred, not preferred, irrelevant for investor and none of the above
Preferred
Q24. Preference share is a _________ instrument? Ownership, debt, hybrid and none
of
the above
Hybrid
Q25. If growth rate of expected earnings goes up then price of stock will ________?
Increase
Q26 The cash flows forecasted at the end of the projection period for capital
budgeting decisions are known asTerminal cash flow
Q27. In case of share buy-back number of outstanding share will
Reduce
Q28. If business risk of a company goes up then price of stock will
Decrease
Q29. Market rate is 9% I'm born with 10% coupon we'll sell _______ par value
Above
Q30. A tight working capital policy will lead to _______ ?
All of the above