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Economics Questions Answers
Which of the following is not an approach to the Capital Structure?
Gross Profit Approach
Net Operating Income Approach
Net Income Approach
Modigliani and Miller Approach
Gross Profit Approach
Which one of the following methods of Capital Budgeting assumes that cash-inflows are reinvested at the project's rate of return?
Net Present Value
Accounting Rate of Return
Internal Rate of Return
Discounted Pay Back Period
Internal Rate of Return
Cost of Equity Share Capital is more than cost of Debt because :
Equity shares are not easily saleable
Equity shares do not provide the fixed dividend rate
Generally the face value of equity shares is less than the face value of debentures
Equity shares have high risk than debts
Equity shares have high risk than debts
Negative Net Working Capital implies that :
Long-term funds have been used for fixed assets
Short-term funds have been used for fixed assets
Long-tern funds have been used for current assets
Short-term funds have been used for current assets
Short-term funds have been used for fixed assets
Which of the following is an implicit cost of increasing proportion of debt of a company?
P.E. Ratio of the company would increase
Rate of return of the company would decrease
Tax-shield would not be available on new debts
Equity shareholders would demand higher return
Equity shareholders would demand higher return
Profitability Index of a Project is the ratio of present value of cash inflows to:
Total cash inflows
Total cash outflows
Present value of cash outflows
Initial cost minus Depreciation
Present value of cash outflows
Which one of the following statements is false?
Effective dividend policy is an important tool to achieve the goal of wealth maximisation
According to Walter, the optimal payout ratio for a growth firm is 100%
MM model asserts that the value of the firm is not affected whether the firm pays dividend or not
'Bird-in-the-hand theory' in reference to dividend decision has been developed by Myron Gordon
According to Walter, the optimal payout ratio for a growth firm is 100%
Which one of the following statements defines the correct meaning of the term 'boundary spanning'?
It refers to an obligation of an individual, firm or institution to account for its activities and accept responsibility for them
It refers to the process that helps the organization and its employees to link with their external environment through specific activities/functions
It refers to the science of morals, principles and rules of conduct
It refers to multiculturism management
It refers to the process that helps the organization and its employees to link with their external environment through specific activities/functions
The VRIO framework, used in HR function in today's era, refers to four criteria. Identify the correct code which stands as correct explanation to VRIO as proposed by Barney.
Valence → Recruiting → Industrial relations → Opportunities
Vision → Rewards → Improvements → Options
Value → Rarity → lmitabilily → Organization
Versatile → Resource → Information → Outsourcing
Value → Rarity → lmitabilily → Organization
Assertion (A) : Induction is an informal information sharing session on miscellaneous issues in an organization.
Reasoning (R) : The rationale of induction is to ensure effective integration of staff into or across the organization for their mutual benefit.
Assertion (A) and Reasoning (R) both are correct and (R) is correct explanation of (A)
Assertion (A) and Reasoning (R) both are correct but (R) is not the correct explanation of (A)
Assertion (A) is correct statement but Reasoning (R) is an incorrect statement
Assertion (A) is an incorrect statement but Reasoning (R) is a correct statement
Assertion (A) is an incorrect statement but Reasoning (R) is a correct statement