71
The total return on a security is equal to the following
A)
$$\frac{{{\text{Periodic cash receipts}} + {\text{Capital gains}}}}{{{\text{Purchase Price of the security}}}}$$
B)
$$\frac{{{\text{Periodic cash receipts}} + {\text{Capital gains}}}}{{{\text{Current Market Price of the security}}}}$$
C)
$$\frac{{{\text{Periodic cash receipts}}}}{{{\text{Current Market Price of the security}}}}$$
D)
$$\frac{{{\text{Periodic cash receipts}} - {\text{Capital gains}}}}{{{\text{Purchase Price of the security}}}}$$
Answer & Solution
Answer: Option
A
72
An example of Euro currency is
A)
a dollar deposit outside the US
B)
a pound sterling deposit within UK
C)
a mark deposit with Germany
D)
All of the above
Answer & Solution
Answer: Option
A
73
Long-term sources of finance are also required for
A)
permanent part of working capital
B)
temporary part of working capital
C)
Both A and B
D)
None of the above
Answer & Solution
Answer: Option
A
74
A leased asset should be depreciated over the
A)
shorter of the lease term and the asset's useful life
B)
longer of the lease term and the asset's useful life
C)
entire lease term
D)
useful life ofthe asset
Answer & Solution
Answer: Option
A
75
Match the following.
List-I List-II
a. Payback method
1. Give due weightage to the profitability of project
b. Unadjusted rate of return method
2. Predetermination of earnings is not necessary
c. NPV method
3. It avoids in calculable risk and uncertainty
d. IRR method
4. Its calculation is much simpler
A)
a-4, b-3, c-2, d-1
B)
a-2, b-3, c-4, d-1
C)
a-3, b-1, c-4, d-2
D)
a-4, b-1, b-2, d-3
Answer & Solution
Answer: Option
C
76
Advantages of adequate working capital funds include
A)
cash discount
B)
liquidity and solvency
C)
high morale
D)
All of these
Answer & Solution
Answer: Option
D
77
Some equity schemes take opposite positions in different market segments, such that a return is earned while remaining risk neutral. They are called
A)
positional funds
B)
arbitrage funds
C)
directional funds
D)
speculative funds
Answer & Solution
Answer: Option
B
78
Select the correct answer regarding the motives for holding inventories by firms.
A)
1, 2, 3, 4
B)
1, 2, 4, 5
C)
1, 4, 5
D)
1, 3, 4
Answer & Solution
Answer: Option
D
79
Which of the following is not an approach to the capital structure?
A)
Gross Profit Approach
B)
Net Operating Income Approach
C)
Net Income Approach
D)
Modigliani and Miller Approach
Answer & Solution
Answer: Option
A
80
"Capital budgeting is concerned with designing and carrying through a systematic investment programme." Who said it?
A)
Charles T. Horngreen
B)
T. G. Tokhey
C)
R. M. Lynch
D)
None of these
Answer & Solution
Answer: Option
A
