9 Jun 2014

Smu mba finance management sample paper set one











Unit 2 Mark 1
Question:
Capitalization refers to the composition of _________ funds
Response:
Short term
Should have chosen
Long term
Mid term
Wrong
None
Feedback:
Not the right choice. Refer section No. 2.2
Question:
Operating capital refers to the ratio of :
Response:
Should have chosen
Capital employed to reserves and surplus
Capital employed to sales generated
Capital employed to inventory
Capital employed to net profit
Question:
Which among the following is excluded in the guidelines for financial planning?
Response:
Fixed asset requirements are to be met from long term sources
Make maximum use of spontaneous source of finance to achieve highest
Should have chosen
Employ historical cost principle
Wrong
Exercise through control over overheads
Feedback:
Not the right choice. Refer section No. 2.2
Question:
What is financial planning? It is the process by which
Response:
all managerial activities are planned
Should have chosen
the funds required for each course of action is decided.
the funds required for long term investments areplanned
Wrong
the funds required for short term purposes are planned
Feedback:
Not right choice. Refer section No. 2.1
Question:
What the operating capital? It is the ratio of :
Response:
Should have chosen
Capital employed to sales generated
Capital employed to net profit generated
Equity capital to net profit generated
Wrong
Equity capital to sales generated
Feedback:
Not right choice. Refer section No. 2.1
Question:
Long term investments should be normally created out of
Response:
Short term funds
Medium term funds
Should have chosen
Long term funds
Wrong
None
Feedback:
Not the right choice. Refer section No. 2.2

Question:
The time value of money uses the ___________ to translate the cash flows occurring at different periods into a comparable value at zero period.
Response:
Should have chosen
required rate of return
Coupon rate
Wrong
Treasury bill rate
Feedback:
Not right choice. Refer section No. 1.3.2
Bank rate

Unit 1 Mark 4
Question:
Match the following
Response:
Match
Correct Answer
User answer
Feedback

Match
Correct Answer
User answer
Feedback
Financing decisions
relate to the acquisition of funds at the least cost
Involve investment in real assets
incorrect
Explicit cost
is also known as visible cost
is also known as visible cost
correct
Implicit cost
is also known as Invisible cost
is also known as Invisible cost
correct
Capital budgeting decision
Involve investment in real assets
relate to the acquisition of funds at the least cost
incorrect
Question:
Match the following
Response:
Match
Correct Answer
User answer
Feedback

Match
Correct Answer
User answer
Feedback
CFO reports to the
Board of directors
the function of auditing, taxation etc
incorrect
A treasurer performs
The function of managing working capital
the function of auditing, taxation etc
incorrect
A controller performs are closely related to
the function of auditing, taxation etc
the quality of cash flows
incorrect
Financial decisions consider
the quality of cash flows
Board of directors
incorrect
Question:
State true or false:
1. Positive net present value can be defined as the excess of present value of cash inflows of any decision implemented over the present value of cash out flows
2. Risk free rate is the rate that an investor can earn on any government security for the duration under consideration
3. Risk premium is the consideration for the risk perceived by the investor in investing in that asset or security.
4. Required Premium is the return that the investors want for making investment in that sector.
Response:
1T, 2T,3T,4T
1F,2T,3T,4T
Correct
1T,2T,3T,4F
1F,2T,2T,4F
Unit 2 Mark 2
Question:
What is considered as the core of value creation process?
Response:
Should have chosen
Financial plan
Expansions & diversification
Mergers & Acquisition
Wrong
Management development program
Feedback:
Not the right choice. Refer section No. 2.1

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