MGT201 Mid and Final Term Past Solved Paper

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

Which of the following is NOT an example of hybrid equity

Common shares

[zaasmi]

Which of the following is NOT an example of hybrid equity

Select correct option:
Convertible Bonds
Convertible Debenture
Common shares
Preferred shares

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

Why common stock of a company must provide a higher expected return than the debt of the same company?

There is more systematic risk involved for the common stock

[zaasmi]

Why common stock of a company must provide a higher expected return than the debt of the same company?
Select correct option:

There is less demand for stock than for bonds
There is greater demand for stock than for bonds
There is more systematic risk involved for the common stock
There is a market premium required for bonds

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

An implicit cost of adding debt to the capital structure is that it:

Increases the required return on equity

[zaasmi]

An implicit cost of adding debt to the capital structure is that it:
Select correct option:

Adds interest expense to the operating statement
Increases the required return on equity
Reduces the expected return on assets
Decreases the firm’s beta

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

Which of the following could NOT be defined as the capital structure of the Company?

The firm’s common stocks only

[zaasmi]

Which of the following could NOT be defined as the capital structure of the Company?
Select correct option:

The firm’s mix of Assets and liabilities
The firm’s common stocks only
The firm’s debt-equity ratio
All of the given options

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

In the dividend discount model, ________ which of the following are not incorporated into the discount rate?

Return on assets

[zaasmi]

In the dividend discount model, _____ which of the following are not incorporated into the discount rate?
Select correct option:

Real risk-free rate
Risk premium for stocks
Return on assets
Expected inflation rate

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

Companies and individuals running different types of businesses have to make the choices of the asset according to which of the following?

Life span of the project

[zaasmi]

Companies and individuals running different types of businesses have to make the choices of the asset according to which of the following?
Select correct option:
Life span of the project
Cost of the capital
Return on asset
None of the given options

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

What are the Direct claim securities?

The securities whose value depends on the cash flows generated by the underlying assets

[zaasmi]

What are the Direct claim securities?

The securities whose value depends on the cash flows generated by the underlying assets
The securities whose value depends on the value of the underlying assets The securities that do not directly generate any returns for its investors
All of the given options

[zaasmi]

@zaasmi said in MGT201 Mid and Final Term Past Solved Paper:

Which of the following formulas represents a correct calculation of the degree of operating leverage?

Q(P-V) / [Q(P-V) - FC]

[zaasmi]

Which of the following formulas represents a correct calculation of the degree of operating leverage?
Select correct option:
(Q - QBE)/Q
(EBIT) / (EBIT - FC)
[Q(P-V) + FC] /[Q(P-V)]
Q(P-V) / [Q(P-V) - FC]