9 Jun 2014

Smu mba finance management sample paper set two


Unit 5 Mark 1

Question:
The company is not legally bound to pay dividends and hence equity capital is free of cost . Comment on the validity of the statement
Response:
Wrong
True
Feedback:
Not right the answer. Refer unit 5.3.5
Should have chosen
False
May be true
True , sometimes
Question:
Capital structure is the mix of
Response:
Correct
Long term source of funds and retained earnings
Feedback:
Right Answer:
Short term source of funds and retained earnings
Medium term source of fund and retained earnings
Short medium long term source of funds retained earnings
Unit 5 Mark 2
Question:
What will be the price of a 5 year discount bond that pays Rs.1000 at maturity if the interest rate (a) is 11% (b) is 9% ?
Response:
593.45 , 549.93
Correct
593.45 , 649.93
Feedback:
052mrk-02fdbk
539.45 , 549.93
539.45 , 694.93
Question:
A bond with a six year left to maturity has a coupon rate of 9% and a par value of Rs.1000. How much is an investor willing to pay for the bond if he requires an annual rate of return of (a) 7% (b) 10% (c) 12% ?
Response:
1094.94 , 876.99 ,955.95
Should have chosen
1094.94 , 955.95 , 876.99
Feedback:
876.99 , 959.99 , 1049.94
Wrong
876.99 , 955.95 , 1099.99
Feedback:
Not right the answer. Rework again
Question:
The CAPM is based on certain assumption. select the odd assumption
Response:
Investors are risk-averse
Should have chosen
Investors make their investment decisions on a multi period horizon
Transaction costs are low
Wrong
All investors agree on the nature of return and risk associated with each investment 
Feedback:
Not right the answer. Refer unit 5.3.5
Question:
While designing an ideal capital structure what factors are irrelevant?
Response:
Return ,Risk
Wrong
Risk , Flexibility
Feedback:
Not right the answer. Refer unit 5.2
Capacity , Control
Should have chosen
Demand and supply factors
Question:
Select the order of risk-return relationship (1) Equity share (2) Debt (3) Preference shares (4) Risk force security (5) Govt bonds.
Response:
5,4,2,3,1
4,5,3,2,1
Correct
4,5,2,3,1
Feedback:
Right Answer
1,3,2,5,4

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