vu fin622 Final Term - Quiz No.7
vu fin622 Corporate Finance Quiz
This quiz belongs to book/course code vu fin622 Corporate Finance of vu organization. We have 17 quizzes available related to the book/course Corporate Finance. This quiz has a total of 10 multiple choice questions (MCQs) to prepare and belongs to topic Final Term. NVAEducation wants its users to help them learn in an easy way. For that purpose, you are free to prepare online MCQs and quizzes.
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Question 1: A good cash management system involves properly managing
Collections, disbursements, cash balances, and capital investment.
Collections, disbursements, cash balances, and marketable securities investment.
Only collections, disbursements, and cash balances.
Only collections and disbursements.
Question 2: Which of the following is advance tool of Project Evaluation?
Net Present value NPV
Internal Rate of Return IRR
Pay Back Period Method
Sensitivity analysis
Question 3: Which of the following would NOT improve the current ratio?
Borrow short term to finance additional fixed assets.
Issue long-term debt to buy inventory
Sell common stock to reduce current liabilities.
Sell fixed assets to reduce accounts payable.
Question 4: Which of the following is known as market portfolio? Select correct option:
A portfolio consists of all risk free securities available in the market
A portfolio consists of securities of the same industry
A portfolio consists of all aggressive securities available in the market
A portfolio consists of all securities available in the market
Question 5: Which of the following may be a major reason for hard capital rationing?
Dilution of earning per share (EPS)
High interest rate
High interest expense
Company own policies
Question 6: Firms with more certain cash flow patterns can operate with:
A higher level of accounts receivable to inventories.
A lower proportion of long-term to short-term debt.
A lower proportion of liquid to total assets.
A higher proportion of liquid to total assets.
Question 7: The percentage change in a firms operating profit (EBIT) resulting from a 1% change in output (sales) is known as the __________.
Degree of profit leverage
Degree of operating leverage
Degree of total leverage
Degree of financial leverage
Question 8: The formula for the break-even quantity of output (QBE), given the price per unit (P), fixed costs (FC), and variable cost per unit (V), is:
QBE = (P - V)/FC.
QBE = (P/FC) - V.
QBE = (FC/P) - V.
QBE = FC/ (P - V).
Question 9: In the formula rE = (D1/P0) + g, what does the symbol g represent?
The expected price appreciation yield from a common stock.
The expected dividend yield from a common stock.
The dividend yield from a preferred stock.
The interest payment from a bond.
Question 10: In case of more than one project, the project with __________ NPV can be undertaken.
Low
Higher
Moderate
zero
