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Financial Management MCQ Questions and Solutions with Explanations | Commerce

Financial Management MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Financial Management MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-8 section-9

Each section contains 100 MCQs on Financial Management .
71
Value of stock is Rs 1200 and preferred dividend is Rs 120 then required rate of return would be
Discuss
Answer & Solution
Answer: Option B
Solution:
Required rate of return = Preferred dividend / Value of stock * 100
= 120 / 1200 * 100 = 10.00%
72
Expected dividends in each year and price investor expecting to get at selling of stock are two components of
Discuss
Answer & Solution
Answer: Option B
Solution:
Expected dividends in each year and price investor expecting to get at selling of stock are two components of expected cash flows. The cash flow an investor or company expects to realize from a project before that project begins.
73
In expected rate of return for constant growth, an expected total rate of return must be
Discuss
Answer & Solution
Answer: Option C
Solution:
In expected rate of return for constant growth, an expected total rate of return must be equal to expected yield on dividend.
74
Owners of corporation having certain rights and privileges are considered as
Discuss
Answer & Solution
Answer: Option B
Solution:
Owners of corporation having certain rights and privileges are considered as common stockholders. Common stockholders are usually given voting rights, with the number of votes directly related to the number of shares owned.
75
Stockholders having right to elect directors and in smaller firms have high post are classified as
Discuss
Answer & Solution
Answer: Option D
Solution:
Stockholders having right to elect directors and in smaller firms have high post are classified as common stockholders. Common stockholders are usually given voting rights, with the number of votes directly related to the number of shares owned.
76
Constant growth rate is 7.2% and an expected rate of return is 12.5% then expected dividend yield will be
Discuss
Answer & Solution
Answer: Option A
Solution:
Expected dividend yield = Expected rate of return - Constant growth rate
= 12.5% - 7.2% = 5.30%
77
An original investment is Rs 30 and an expected capital gain is Rs 10 then an expected final stock price will be
Discuss
Answer & Solution
Answer: Option B
Solution:
Final stock price = Original investment + Expected capital gain
= Rs. 30 + Rs. 10 = Rs. 40.00
78
Constant growth rate is 6.5% and an expected dividend yield is 3.4% then an expected rate of return would be
Discuss
Answer & Solution
Answer: Option A
Solution:
Expected rate of return = Constant growth rate + Expected dividend yield
= 6.5% + 3.4% = 9.90%
79
According to investors point of view, an expected rate of return is rate on stocks which they
Discuss
Answer & Solution
Answer: Option A
Solution:
According to investors point of view, an expected rate of return is rate on stocks which they receive in future. The expected rate of return is the return on investment that an investor anticipates receiving.
80
Second step in calculating value of stock with non-constant growth rate is to find out an
Discuss
Answer & Solution
Answer: Option C
Solution:
Second step in calculating value of stock with non-constant growth rate is to find out an expected price of stock. Nonconstant growth models assume the value will fluctuate over time. You may find that the stock will stay the same for the next few years, for instance, but jump or plunge in value in a few years after that.