IMT SOLVED ASSIGNMENTS AVAILABLE – FINC002 Test2
ASSIGNMENT
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Question 1:
If credit sales is 100000, credit period is 30 days, calculate the average receivables?
a) 8219
b) 8333
c) 3333
d) 3288
Question 2:
The relationship between security return and market return is shown by
a) Rf
b) Rm
c) Rm-Rf
d) Beta
Question 3:
Which of the following method is considered the best evaluation technique for long term investment decision?
a) NPV
b) IRR
c) Pay-Back Period
d) Profitability Index
Question 4:
Increase in the frequency of compounding results into_____ maturity value.
a) Higher
b) Lower
c) Same
d) Fluctuating
Question 5:
In which of following frequecy of compounding, present value of annuity will be lowest?
a) Annual
b) Quarterly
c) Monthly
d) Daily
Question 6:
Shyam deposits Rs 5000 every year for next 3 years at 6% semiannual compounding. Calculate the future value if investment? Future value annuity factor at 3% for 3years and 6 years is 3.0909 & 6.4684 respectively and at 6% for 3years and 6 years is 3.1836 & 6.9753 respectively..
a) 15454.5
b) 16171
c) 15918
d) 17438.25
Question 7:
For dairy Ltd Beta is 0.8, Nifty Returns 15% and T-bill rate is 8% what is the cost of equity?
a) 13.56%
b) 15%
c) 5.6%
d) 7%
Question 8:
In Excel, in order to calculate the EMI for loan repayment, which function has to be used?
a) PV
b) FV
c) NPV
d) PMT
Question 9:
Which of the following is ultimate objective of financial management?
a) Profit maximization
b) Shareholder’s wealth maximization
c) Leverage Minimization
d) Funding maximization
Question 10:
A company replaces an old machinary with salvage value of Rs 100000 replaced by a machinery costing Rs 500000. The relevant cash flows for evaluation of this project is_____?
a) 100000
b) 500000
c) 400000
d) 600000
Question 11:
In which of following frequecy of compounding, maturity value of investment will be highest?
a) Annual
b) Quarterly
c) Monthly
d) Daily
Question 12:
Arun buys an stock at Rs 20 & sells at Rs 25 after 10 months. During this period, he receives a dividend of Rs 5 on his invesments. Calculate the Holding Period Return?
a) 0.25
b) 0.5
c) 0.2
d) 0.4
Question 13:
When in the calculation of IRR, intermitant cash flows are reinvested at required rate of return, the resultant rate is known as______?
a) CIRR
b) MIRR
c) IRR
d) None of the above
Question 14:
Which of the following AAA debentures will have highest price if YTM is?
a) 0.07
b) 0.08
c) 0.075
d) 0.085
Question 15:
If the credit period is increased for the customers of the company, operating cycle will
a) reduce
b) increase
c) remain same
d) unaffected
Question 16:
In case of share buy-back, number of outstanding share will
a) reduce
b) increase
c) remain same
d) unaffected
Question 17:
If the coupon rate of a debenture is increased then its YTM will
a) decrease
b) increase
c) remain same
d) fluctuate
Question 18:
Which of the following cost is important while evaluating the investment decisions?
a) Sunk Cost
b) Incremental Cost
c) Both of the above
d) None of the above
Question 19:
As per Bird in hand theory, high dividend pay-out is___ to low pay-out?
a) Preferred
b) not preferred
c) irrelvant for investor
d) None of the above
Question 20:
Which of the following instrument is riskiest?
a) Shares
b) Preference Shares
c) Debentures
d) Fixed Deposit
Question 21:
Moon Ltd invests Rs 800000 in a paper manufacturing plant. This is expected to generate Rs 150000 every year for next seven years. Cost of capital for the project is 10%. PVAF for 7 years at 10% is 5.3349. Calculate the NPV of the project?
a) 800000
b) 800235
c) 235
d) -235
Question 22:
The risk which can be reduced by diversification is known as
a) Systematic Risk
b) Unsystematic Risk
c) Total Risk
d) Market Risk
Question 23:
If the annual rent expense goes up, the operating leverage will____and will give rise to more than proportionate change in____?
a) decrease, EPS
b) decrease, EBIT
c) increase, EPS
d) increase, EBIT
Question 24:
Sheela needs Rs 500000 at the end of 5 years. How much amount she should invest right now @ 10%. Present Value of 1 Rs at 10% for 5 years is .6209
a) 100000
b) 155225
c) 310450
d) 400000
Question 25:
Cost of equity is always equal to or_____ than WACC
a) lower
b) same
c) higher
d) fluctuating
Question 26:
If business risk of a company goes up than price of stock will
a) decrease
b) increase
c) remain same
d) fluctuate
Question 27:
A tight working capital policy will lead to_____
a) Low debtors
b) Low inventory
c) low inventory carrying cost
d) All of the above
Question 28:
For A Ltd. Annual demand is 10000 units, carrying cost is 2 Rs per unit and order cost is Rs 50. Calculate the EOQ
a) 707
b) 28
c) 1000
d) 200
Question 29:
For a firm, weight of equity & debt is 0.6 & 0.4 respectively and cost of equity is 15%, Cost of debt is 9%, tax rate is 30% Calculate the WACC for the firm?
a) 0.126
b) 0.1152
c) 0.12
d) 0.084
Question 30:
Brexit, Greece Crises, Chinese Crises, Sub-Prime Crises are the examples of which of the following?
a) Systematic Risk
b) Unsystematic Risk
c) Total Risk
d) Specific Risk