Business Finance MCQ Questions and Solutions with Explanations | Commerce

Which of the following statements are true? Indicate the correct answer.
1. Tax shield on depreciation and interest is an important valuable both for lessor and lessee.
2. A lessee may evaluate the lease options as against the buying option.
3. Sale and lease back and leveraged lease are types of financial lease.
4. Lease or financing is a type of capital budgeting decision from the point of view of the lessee.
Select the correct answer

Under the Capital Asset Pricing Model, the return required from security is related to

Which of the following are the main features of a 'bought out deal' in the context of corporate funding?
(i) It is a method of offering securities to the public through a sponsor or underwriter.
(ii) A bank, financial institution, or an individual can never not be a sponsor.
(iii) The securines are listed in one or more stock exchanges within a time-frame mutually agreed upon by the company and the sponsor.
(iv) The bought out deals facilitate better investor protection.
(v) As the sponsor may occupy a large number of shares, it may trouble the company.

Objectives of management of working capital include

Which of the following statements is correct for a conservative financing policy for a firm relative to a former aggressive policy?

Spy stands for

Which is not a form of short-term spontaneous credit?

Which of the following statement is correct?

Cost of capital from all the sources of funds is called

A portfolio comprises two securities and the expected return on them is 12% and 16% respectively. Determine return of portfolio if first security constitutes 40% of total portfolio.