MGT201 Midterm Past Paper Spring 2010 Session 6

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JOIN FB GROUP FOR VU HELP · MIDTERM EXAMINATION · Spring 2010 · MGT201- Financial Management (Session - 6) · Ref No: 1426449 Time: 60 min Marks: 44 Student Info · StudentID: · Center: · OPKST · ExamDate: · 5/29/2010 12:00:00 AM

Q No.

Total

Marks

Q No.

Q1. Among the pairs given below select a(n) example of a principal and a(n) example of an agent respectively. (1 marks)

1. Shareholder; manager
2. Manager; owner
3. Accountant; bondholder
4. Shareholder; bondholder

Q2. Which group of ratios measures a firm's ability to meet short-term obligations? (1 marks)

1. Liquidity ratios
2. Debt ratios
3. Coverage ratios
4. Profitability ratios

Q3. would be considered a cash-flow item from an "investing" activity? (1 marks)

1. Cash outflow to the government for taxes
2. Cash outflow to shareholders as dividends
3. Cash outflow to lenders as interest
4. Cash outflow to purchase bonds issued by another company

Q4. All of the following influence capital budgeting cash flows EXCEPT __________. (1 marks)

1. Choice of depreciation method for tax purposes
2. Economic length of the project
3. Projected sales (revenues) for the project
4. Sunk costs of the project

Q5. An investment proposal should be judged in whether or not it provides: (1 marks)

1. A return equal to the return require by the investor
2. A return more than required by investor
3. A return less than required by investor
4. A return equal to or more than required by investor