When a lease transfers substantially all the risks and rewards of ownership to lessee, this is called
A. a finance least
B. an operating lease
C. a buy-to-let agreement
D. a rental agreement
Select an option to see the answer and solution.
IPO and FPO are linked with
A. Rights issues
B. QIPs
C. Bough tout deals
D. Public issues
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The ratio measuring earnings available to the holder of an ordinary share is
A. ROI
B. Market-to-book ratio
C. EPS
D. ROE
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On the expiration date of the futures contract, the price of the contract
A. Always equals the purchase price of the contract
B. Always equals the average price over the life of the contract
C. Always equals the price of the underlying asset
D. Always equals the average of the purchase price and the price of the underlying asset
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Which is the source of mid-term finance?
A. Micro credit
B. Specialised financial institution
C. Collect advances from purchasers
D. Discounting the bills receivable
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In the foreign exchange market, factors that shift the expected return schedule for foreign deposits include
1. a change in the foreign interest rate.
2. a change in the expected future exchange rate.
3. a change in the current exchange rate.
Select the correct answer by using the options given below
A. Both 1 and 2
B. Both 2 and 3
C. Both 1 and 3
D. All of the above
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Which of the following is not a source of long-term finance?
A. Trade credit
B. Debentures
C. Retained earnings
D. Equity shares
Select an option to see the answer and solution.
Sometimes, the investors would prefer to pay a stock dividend rather than a regular cash dividend. Which of the following statements are true in such kinds of decisions?
A. They do not provide liquidity to the investors
B. They do ensure capital gains to the stockholders
C. If investors are not interested in a long-term investment, they will prefer regular cash payments over payments of additional stock
D. All of the above
Select an option to see the answer and solution.
Long-term loans from the public is called
A. debentures
B. retained earnings
C. shares
D. public deposits
Select an option to see the answer and solution.
Total of all current assets is called
A. gross working capital
B. net working capital
C. fixed working capital
D. None of these
Select an option to see the answer and solution.
What prompted Bretton woods Agreement?
A. To set up a system that would maintain a stable exchange rate system
B. To create a flexible exchange rate system
C. To stop World War II
D. Eradicate the economic difficulties brought in by World War II
Select an option to see the answer and solution.
Match the following.
List-I (Capital Structure Principles)
List-II (Features)
a. Cost principle
1. Management chooses such combination of sources of financing, which can easily adapt to changes
b. Risk principle
2. While designing the structure, the finance manager remembers that existing management control and ownership remains undisturbed
c. Control principle
3. Reliance is placed more on equity for financing capital requirements than excessive use of debts
d. Flexibility principle
4. Cost of capital structure should be minimised and Earning Per Share (EPS) should be maximised
A. a-2, b-1, c-4, d-3
B. a-3, b-1, c-4, d-2
C. a-3, b-4, c-1, d-2
D. a-4, b-3, c-2, d-1
Select an option to see the answer and solution.
One difference between a financial lease and operating lease is that
A. there is a often a call option in a financial lease
B. there is often an option to buy in an operating lease
C. an operating lease is often cancellable by the lessee
D. a financial lease is often cancellable by the lessee
Select an option to see the answer and solution.
Assertion (A): The comparative cost theory is static in character.
Reason (R): The comparative cost theory is based on fixed supplies of factors of production.
A. (A) is correct, but (R) is incorrect
B. (R) is correct, but (A) is incorrect
C. (A) and (R) both are correct, but (R) is not the correct explanation of (A)
D. (A)and (R) both are correct, and (R) is the correct explanation of (A)
Select an option to see the answer and solution.
In the foreign exchange market, the . . . . . . . . of one country is traded for the . . . . . . . . of another country.
A. currency, currency
B. currency, financial instruments
C. currency, goods
D. goods, goods
Select an option to see the answer and solution.
Which of the following are the main benefits of non-voting shares to a company?
A. It may protect the company from hostile takeovers
B. The voting rights may not be provided to such shareholders
C. Non-voting shareholders may be given a higher dividend
D. All of the above
Select an option to see the answer and solution.
The Finance Act, 2020, changed the method of dividend taxation. Which of the following facts are related to dividend taxation?
A. The dividend receivedfrom an Indian company was exempt until 31st March 2020 (FY2019-20), as the company declaring such dividend already paid dividend distribution tax before making payment
B. All the dividend receivedon or after 1st April 2020, is taxable in the hands of the investor or shareholder
C. The DDT liability on companies and mutual funds stand withdrawn
D. All of the above
Select an option to see the answer and solution.
Which of the following can be defined as the cost of capital from an investor's point of view?
A. Interest Rate
B. Market Value
C. Yield of Capital Sacrificed
D. Stock Exchange Value
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In an agreement to exchange one currency for another in three months at a fixed price, the price is the . . . . . . . .
A. spot exchange rate
B. money exchange rate
C. forward exchange rate
D. monthly exchange rate
Select an option to see the answer and solution.
ADRs and GDRs are an excellent means of investment to invest in India for
A. NRl's
B. Foreign nationals
C. Both A and B
D. None of the above
Select an option to see the answer and solution.