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MCQ: During the planning period, a marginal cost for raising a new debt is classified as, MCQ: The cost of common stock is 14% and the bond risk premium is 9% then the bond yield will be, MCQ: In weighted average cost of capital, a company can affect its capital cost through, MCQ: A risk associated with the project and the way considered by well diversified stockholder is classified as, MCQ: The cost of common stock is 13% and the bond risk premium is 5% then the bond yield would be. The word ‘cost’ is also known as ‘money cost’ which is linked with the capital expenditure of a company. (iii) Cost of capital does not comprise any risk premium. $596,300 2. "During the planning period, a marginal cost for raising a new debt is classified as" Multiple Choice Questions (MCQ) on cost of capital with choices relevant cost, debt cost, borrowing cost, and embedded cost for online BBA degree. A. Cost of Capital. raises its prices to compensate for this fact. The cost of capital is the cost of raising specific sources of funds in financial markets today. Generally, long-term capital gain is charged to … This is consists of complete chaper conceptual overviews. 2015/2016. test bank. (vi) Different sources have same cost of capital. B. $485,300 3. Removing question excerpt is a premium feature, During planning period, marginal cost to raise a new debt is classified as, Cost of common stock is 14% and bond risk premium is 9% then bond yield is, In weighted average cost of capital, company can affect its capital cost through, Risk associated with project and way considered by well diversified stockholder is classified as, Cost of common stock is 13% and bond risk premium is 5% then bond yield is, By Mehtajimmit | Last updated: Apr 14, 2016. MCQ’s on Human Capital Management with answers _____ is defined as the process of acquiring, training, managing, retaining employees for them to contribute effectively in the processes of the organization. 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Industrial Engineering (2161907) MCQ. One assumption underlying the use of the cost of capital to analyze capital projects is that: current costs will remain the same; capital structure will vary with the type of financing; different risk projects are required to diversify the firm; the analyzed projects are of comparable risk to … MCQ of Corporate Finance 1.11..1. These incremental changes are most correctly referred to as: the weighted average cost of capital; the marginal cost of capital; the cost of capital; the incremental cost of capital; View answer Given below are essential MCQs on the Cost concept to analyze your understanding of the topic. Cost of advertising and printing prospectus is called_____ (a) Floatation cost (b) Debt cost (c) Equity cost (d) Dividend cost (a) Floatation cost. Policy of capital structure. MCQ on Financial Management 1. Cost of debt=7.26% Cost of debt=8.62% Cost if debt= 8.91% Which of the following sources of funds for capital investment involves a tax adjustment to determine the cost of capital? The cost of floatation are 2%. MCQ Test 1 on Capital Budgeting and Cost Benefit Analysis MCQ If the net initial investment is $985000 and returned working capital is $7500 then average investment over five years is 1. $496,250 4. It avoids the problem of computing the required rate of return for each investment proposal. The weighted average of the firm’s costs of equity, preferred stock, and after tax debt is the: a. reward to risk ratio for the firm. Financial Management MCQ Questions and answers with easy and logical explanations. MCQ Questions for Class 12 Business Studies with Answers were prepared based on the latest exam pattern. A. SHRM B. HCM C. HRD D. HRM ANSWER: B. Policy of capital structure. Investment A offers an expected rate of return of 16%, B of 8%, and C of 12%. Retained profits Issuing debt Issuing common stock All of the above involve a tax adjustment In case of net income approach, the cost of equity is: $486,250 C MCQ If the initial investment is $765000 and the payback period is 4.5 years then increase in future cash flows is 1. Types of Human Capital doesn’t include A. Behaviour B. The average annual dividend payout is ‘ 27 per share (Face Value = ‘100). C. Policy of investment. $6,442,500 3. 2 … Prepare for better future try practice test on Cost of Capital with MCQ on Project feasibility, retained earning, dividend yield & weighted average cost Now! Shareholderwealth in a firm is. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Cost of Capital Multiple Choice Questions and Answers (MCQs), cost of capital quiz answers PDF 1, financial management tests to study online certification courses. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. (v) Risk free interest rate and cost of capital are same things. MCQ Questions for Class 12 Business Studies with Answers were prepared based on the latest exam pattern. 1. "Cost Accounting MCQ" with answers helps with fundamental concepts for self-assessment with theoretical, analytical, and distance learning. Cost of control is the excess price paid for investment over and above proportionate share of net assets acquired by the holding company. (iii) Cost of capital does not comprise any risk premium. SSC MCQ Question Ans. Intellectual C. Policy of investment. Uncategorized; Tags . Financial Management MCQ is important for exams like CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other accounts department exam. May 14, 2020 • 1h 24m . B) the maximum return a project can earn. (b) Sunk Costs, (c) Change in Working Capital, (d) Inflation effect. Every business enterprise has its own cost of capital. | Take This Quiz. The profit of an enterprise can be increased by (i)Reducing total costs of production (ii)Increasing sales value (iii)Increasing capital cost (iv)Increasing manpower Which of the above are true? MCQ On Working Capital Management MCQ On Working Capital Management . the cost of capital for a firm with no debt in its capital structure. b. is the same as the. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Beck, Inc., issued $100,000, 15-year term bonds with a coupon rate … Categories. The cost of capital is A) the minimum return that a capital budgeting project must earn for it to be accepted. It avoids the problem of computing the required rate of return for each investment proposal. a) Private Company. Cost of the firm’s equity capital at which the market value of the firm will remain unchanged. C) it is comparable to the prevailing market interest rates. does not adjust its hurdle rate up or down regardless of this fact. (iv) Cost of capital is basic data for NPV technique. During planning period, a marginal cost for, Prices of bonds will be decreased if an interest rates, A premium which reflects possibility of issuer, In retention growth model, payout ratio is, In calculation of net cash flow, depreciation. Financial Management MCQ Questions and answers with easy and logical explanations. Chapter 1: The financial environment Chapter 2: Corporate objectives Chapter 3: Corporate governance Chapter 4: Risk, return and portfolio theory Chapter 5: Capital structure and the cost of capital Chapter 6: Capital investment decisions MCQs Papers Definitions. 11. b) The book value of the firm's assets less the book value of its liabilities c) The amount of salary paid to its employees. The LMN Corporation is considering an investment that will cost $80,000 and have a useful life of 4 years. MCQ On Working Capital Management MCQ On Working Capital Management . MCQ questions and answers on Cost of Capital quiz answers PDF 2 to learn online finance degree courses. SSC MCQ Question Ans. Test your knowledge of the weighted average cost of capital (WACC) using this online quiz and printable worksheet. D. chapter 14 cost of capital chapter 14 cost of capital multiple choice questions group of individuals got together and purchased all of the outstanding shares of. Policy of dividends. The weighted cost of capital is the minimum acceptable return on any current average risk project under consideration today. Page-2 section-2 (v) Risk free interest rate and cost of capital are same things. A firm's overall cost of capital: d. varies inversely with its cost of debt. Which of the following affects capital budgeting decision? increases with increasing levels of financial leverage. Cost Accounting Multiple Choice Questions and Answers (MCQs): Quizzes & Practice Tests with Answer Key (Cost Accounting Quick Study Guide & Course Review) covers subject tests for competitive exams to solve 1100 MCQs. This session would be helpful for aspirants preparing for the CA Exam. D) none of the above. Check the below NCERT MCQ Questions for Class 12 Business Studies Chapter 9 Financial Management with Answers Pdf free download. In capital budgeting, cost of capital is used as discount rate and is based on predetermines cost of inflation cost of debt and equity cost of opportunity cost of transaction Show Result Correct - Your answer is correct. As more and more funds are required by the firm, the cost of each component of the capital structure may increase. A proposal is not a Capital Budgeting proposal if it: (a) is related to Fixed Assets, (b) brings long-term benefits, (c) brings short-term benefits only, (d) has very large investment. (vii) Tax liability of the firm is relevant for cost of capital … The weighted cost of capital is the minimum acceptable return on any current average risk project under consideration today. represented by. A Quiz On Paraphrasing: MCQ Exam A Quiz On Paraphrasing: MCQ Exam . 11. David should . We have provided Financial Management Class 12 Business Studies MCQs Questions with Answers to help students understand the concept … Prevailing market interest rates one of the year of transfer of capital, objective Exam prep topics... ( v ) risk free interest rate and cost of capital of all sources... Mcqs of cost of capital is earned, the statement given in the tax rate ( Value... Behaviour b compensate for this fact the three fundamental methods of firm valuation only. 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