Financial Management

✅ The correct answer is D.
Stockholders having right to elect directors and in smaller firms have high post are classified as common stockholders. Common stockholders are usually given voting rights, with the number of votes directly related to the number of shares owned.

✅ The correct answer is C.
Bond risk premium is added in to bond yield to calculate the cost of common stock. The cost of common stock is common stockholders’ required rate of return. Companies can raise new common equity in two ways: by a new common stock issue or by retaining and reinvesting previous earnings.

✅ The correct answer is A.
Probability distribution is classified as normal if expected return lies between ( + 1 and -1). A probability distribution is a statistical function that describes all the possible values and likelihoods that a random variable can take within a given range.

✅ The correct answer is B.

✅ The correct answer is A.
An indication in a way that variance of y-variable is explained by x-variable which is shown as degree of dispersion is one. The measure of dispersion helps us to study the variability of the items. In a statistical sense, dispersion has two meanings: first it measures the variation of the items among themselves, and second, it measures the variation around the average.

✅ The correct answer is E.
Mobilizing funds, Risk returns trade off, Deployment of funds and Control over the uses of funds are the function of the finance manager.

✅ The correct answer is D.
Preference dividend is not tax deductible, The claim of preference shareholders is prior to the claim of equity shareholders and Preference shareholders are not the owners of the concern characteristics are true, with reference to preference capital.

✅ The correct answer is B.
In time value of money, periodic rate is shown on timeline. A periodic interest rate can be charged on a loan or realized on an investment over a specific period of time.

✅ The correct answer is B.
An increasing in interest rate leads to decline in value of outstanding bonds. Outstanding Bonds means all Previously Issued Bonds, which remain outstanding as of the first interest and/or principal payment date following the current Fiscal Year excluding Bonds to be redeemed at a later date with proceeds of prior prepayments of Maximum Special Taxes.

✅ The correct answer is A.
The amount of the temporary working capital keeps on fluctuating from time to time. Temporary working capital (TWC) is the temporary fluctuation of networking capital over and above the permanent working capital.