981. Which is called as Dividend Ratio Method?
A. Dividend Yield Method
B. Debt Equity Method
C. Asset Method
D. Equity Method

982. If the current ratio is 2: 1 and working capital is Rs. 60,000, What is the value of the current assets?
A. Rs. 60,000
B. Rs. 1,00,000
C. Rs. 1,20,000
D. Rs. 1,80,000

983. Depreciation is incorporated in cash flows because it
A. Is unavoidable cost
B. Is a cash flow
C. Involves an outflow
D. Reduces tax liability

984. Which one is more appropriate for cost of retained earning?
A. Weighted Average cost of capital
B. Opportunity cost to the firm
C. Expected rate of return by the investor
D.None of the above

985. Debt financing is a cheaper source of finance because of
A. Time value of Money
B. Rate of Interest
C. Tax deductibility of Interest
D. Dividends not payable to lenders.

986. If compounding is done quarterly in year, the effective rate of interest is equal to
A. (4 x nominal rate of interest
B. (1 + nominal rate of interest / 4)4
C. (1 + nominal rate of interest)/ 4
D. All of the above

987. The conflicts in project ranking in capital budgeting as per NPV and IRR may arise because of
A. Size disparity
B. Time disparity
C. Life disparity
D. All of the above

988. Capital gearing ratio indicates the relationship between
A. assets and capital
B. loans and capital
C. equity shareholders fund and long term borrowed funds
D. debentures and share capital

989. A newly established company cannot be successful in obtaining finance by way of
A. issue of equity capital
B. issue of preference share
C. issue of debenture
D. None of the above

990. The degree of financial leverage reflects the responsiveness of
A. Operating income to change in total revenue
B. EPS to change in EBIT
C. EPS to change in total revenue
D. None of the above.

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