A commercial banker would prefer a ____________ debt-equity ratio over the years as it indicates financial strength of a unit. A. Declining. B. Increasing. C. Stable. D. Fluctuating.

A commercial banker would prefer a ____________ debt-equity ratio over the years as it
indicates financial strength of a unit.
A. Declining.
B. Increasing.
C. Stable.
D. Fluctuating.
by

2 Answers

Answer :

A. Declining

A commercial banker would prefer a declining debt-equity ratio over the years as it indicates the financial strength of a unit. A declining debt-equity ratio means that the company is reducing its debt and increasing its equity, which makes it less risky to lend money to. This means that the company has a better ability to generate cash flows to service its debt and has a stronger balance sheet.

A stable debt-equity ratio may suggest that the company is not taking advantage of debt to grow its business and that it's not taking on new debt to expand. While an increasing debt-equity ratio may indicate that the company is taking on more debt than it can handle and might be in financial trouble, and fluctuating ratio might indicate that the company is not able to manage its debt and equity properly.
by

Answer :

A. Declining.
by

Related questions

____________, which is included in the project cost, is estimated on the basis of the year when the enterprise breaks even. A. working capital B. cost of capital C. cost of production D. cost of equity

Description : ____________, which is included in the project cost, is estimated on the basis of the year when the enterprise breaks even. A. working capital B. cost of capital C. cost of production D. cost of equity

Last Answer : A. working capital

Institutional agencies grant financial assistance to small scale industries for _________. A. participation in equity capital only. B. acquisition of fixed assets. C. working capital assistance. D. all of the above.

Description : Institutional agencies grant financial assistance to small scale industries for _________. A. participation in equity capital only. B. acquisition of fixed assets. C. working capital assistance. D. all of the above.

Last Answer : D. all of the above.

The process of preparing an inventory of skills needed for effective implementation of the project is called as ____________. A. Economic viability. B. Financial feasibility. C. Technical feasibility. D. Managerial competence.

Description : The process of preparing an inventory of skills needed for effective implementation of the project is called as ____________. A. Economic viability. B. Financial feasibility. C. Technical feasibility. D. Managerial competence.

Last Answer : D. Managerial competence.

____________ is primarily concerned with the identification of the project demand potential and the selection of the optimal technology. A. Techno-economic analysis. B. Feasibility analysis. C. Input analysis. D. Financial analysis.

Description : ____________ is primarily concerned with the identification of the project demand potential and the selection of the optimal technology. A. Techno-economic analysis. B. Feasibility analysis. C. Input analysis. D. Financial analysis.

Last Answer : A. Techno-economic analysis.

Which of the following is not an aspect of appraisal of term loans by commercial banks? A. Financial feasibility. B. Technical feasibility. C. Economic feasibility. D. Societal feasibility.

Description : Which of the following is not an aspect of appraisal of term loans by commercial banks? A. Financial feasibility. B. Technical feasibility. C. Economic feasibility. D. Societal feasibility.

Last Answer : D. Societal feasibility.

Which of the following statements relating to working capital financing is not correct? A. An aggressive policy uses long-term debt to finance fluctuating current assetsB. Long-term debt is less risky that short-term debt C. A conservative policy uses long-term debt to finance fixed assets D. Short-term debt is cheaper than long-term debt E. The matching principle indicates that fluctuating current assets should be financed by short-term debt

Description : Which of the following statements relating to working capital financing is not correct? A. An aggressive policy uses long-term debt to finance fluctuating current assets B. Long-term debt ... . The matching principle indicates that fluctuating current assets should be  financed by short-term debt

Last Answer : A. An aggressive policy uses long-term debt to finance fluctuating current assets

Having less than 50 percent of equity share in an international venture is calleda) Minority interest b) Joint venture c) Majority interest d) Exporting

Description : Having less than 50 percent of equity share in an international venture is calleda) Minority interest b) Joint venture c) Majority interest d) Exporting

Last Answer : a) Minority interest

A project, which may not add to the existing profits, should be financed by _________ A. debentures. B. preference share capital. C. equity capital. D. public deposits.

Description : A project, which may not add to the existing profits, should be financed by _________ A. debentures. B. preference share capital. C. equity capital. D. public deposits.

Last Answer : A. debentures.

Investment in which of the following is most risky? A. Equity shares. B. Preference shares. C. Debentures. D. Land.

Description : Investment in which of the following is most risky? A. Equity shares. B. Preference shares. C. Debentures. D. Land.

Last Answer : C. Debentures.

Which of the following securities proves a burden on finances of the company, when company is not earning profits? A. Equity shares. B. Preference shares. C. Redeemable preference shares. D. Debentures.

Description : Which of the following securities proves a burden on finances of the company, when company is not earning profits? A. Equity shares. B. Preference shares. C. Redeemable preference shares. D. Debentures.

Last Answer : D. Debentures.

Which of the following sources is not use for medium term financing? A. Issue of equity shares. B. Issue of debentures. C. Term loans from banks. D. Sale of current asset.

Description : Which of the following sources is not use for medium term financing? A. Issue of equity shares. B. Issue of debentures. C. Term loans from banks. D. Sale of current asset.

Last Answer : A. Issue of equity shares.

he ratio which is used to ascertain the soundness of the long term financial position is------------ a) Debt equity ratio b) Liquidity ratio c) Activity ratio d) Gross profit ratio

Description : he ratio which is used to ascertain the soundness of the long term financial position is------------ a) Debt equity ratio b) Liquidity ratio c) Activity ratio d) Gross profit ratio

Last Answer : a) Debt equity ratio

The Markets and Competitors section of a business plan should contain ____________. A. A statement of the target market. B. The size of each market segment. C. The key characteristics of buyers in each business segment. D. All the above.

Description : The Markets and Competitors section of a business plan should contain ____________. A. A statement of the target market. B. The size of each market segment. C. The key characteristics of buyers in each business segment. D. All the above.

Last Answer : a

O & M refers to ____________ A. overall efficiency of business. B. efficiency of office and administrative work. C. office work measurement. D. office and management study.

Description : O & M refers to ____________ A. overall efficiency of business. B. efficiency of office and administrative work. C. office work measurement. D. office and management study.

Last Answer : D. office and management study.

District Industries Centres are located ____________. A. in each district. B. in each state. C. only in selected districts. D. only in selected states.

Description : District Industries Centres are located ____________. A. in each district. B. in each state. C. only in selected districts. D. only in selected states.

Last Answer : A. in each district.

The type of diversification in which the company adds up same type of products at the same level of production is ____________. A. conglomerate diversification. B. horizontal integration. C. vertical integration. D. concentric integration.

Description : The type of diversification in which the company adds up same type of products at the same level of production is ____________. A. conglomerate diversification. B. horizontal integration. C. vertical integration. D. concentric integration.

Last Answer : B. horizontal integration.

EST stands for ____________. A. Earliest Start Time. B. Event Start Time. C. Effective Start Time. D. Essential Start Time.

Description : EST stands for ____________. A. Earliest Start Time. B. Event Start Time. C. Effective Start Time. D. Essential Start Time.

Last Answer : A. Earliest Start Time.

____________ is a graphical representation of the various activity and event relating to a project. A. Network analysis. B. Scheduling technique. C. Logical Model. D. Network Diagram

Description : ____________ is a graphical representation of the various activity and event relating to a project. A. Network analysis. B. Scheduling technique. C. Logical Model. D. Network Diagram

Last Answer : D. Network Diagram

Today, many companies are using managerial techniques that are designed to encourage _________. A. increasing profits B. legal compliances C. Ethical behaviour D. shareholders value

Description : Today, many companies are using managerial techniques that are designed to encourage _________. A. increasing profits B. legal compliances C. Ethical behaviour D. shareholders value

Last Answer : C. Ethical behaviour

Additional time which a non-critical activity can consume without increasing the project duration is called _____________. A. Total Float. B. Free Float C. Independent Float. D. Dependant Float

Description : Additional time which a non-critical activity can consume without increasing the project duration is called _____________. A. Total Float. B. Free Float C. Independent Float. D. Dependant Float

Last Answer : A. Total Float.

Trademarks relate to _______. A. Practice and knowledge acquired through experience B. The protection of proprietary information of commercial value C. The right to reproduce ones own original work D. Brand identity

Description : Trademarks relate to _______. A. Practice and knowledge acquired through experience B. The protection of proprietary information of commercial value C. The right to reproduce ones own original work D. Brand identity

Last Answer : D

______________ describes the direction, the enterprise is going in, what its goals are, where it wants to be,and how it is going to get there. A. project report B. technical anlaysis C. market analysis D. financial analysis

Description : ______________ describes the direction, the enterprise is going in, what its goals are, where it wants to be,and how it is going to get there. A. project report B. technical anlaysis C. market analysis D. financial analysis

Last Answer : A. project report

Project mission and objectives, procedures and systems used, and organization resources used typically appear in the _____ section of the final project report. A. Analysis B. Recommendation C. lessons learned D. financial feasibility

Description : Project mission and objectives, procedures and systems used, and organization resources used typically appear in the _____ section of the final project report. A. Analysis B. Recommendation C. lessons learned D. financial feasibility

Last Answer : A. Analysis

As a new company grows, the entrepreneur will need to _________. A. be responsive to changes in the market. B. ensure financial controls are maintained. C. build a management team. D. all the above.

Description : As a new company grows, the entrepreneur will need to _________. A. be responsive to changes in the market. B. ensure financial controls are maintained. C. build a management team. D. all the above.

Last Answer : D. all the above.

_____________ is primarily concerned with the identification, qualification and evaluation of the project resources. A. Techno-economic analysis. B. Feasibility analysis. C. Input analysis. D. Financial analysis.

Description : _____________ is primarily concerned with the identification, qualification and evaluation of the project resources. A. Techno-economic analysis. B. Feasibility analysis. C. Input analysis. D. Financial analysis.

Last Answer : B.Feasibility analysis.

A key aspect of the financial section of the business plan is _________. A. A statement of management skills. B. A realistic sales forecast. C. Production capacity. D. A description of competitors.

Description : A key aspect of the financial section of the business plan is _________. A. A statement of management skills. B. A realistic sales forecast. C. Production capacity. D. A description of competitors.

Last Answer : B. A realistic sales forecast.

_________________ implies the availability or otherwise of plant and machinery and technical know how to produce the product. A. Economic viability. B. Financial feasibility. C. Technical feasibility. D. Managerial competence

Description : _________________ implies the availability or otherwise of plant and machinery and technical know how to produce the product. A. Economic viability. B. Financial feasibility. C. Technical feasibility. D. Managerial competence

Last Answer : C. Technical feasibility.

The term ___________ denotes bonus or financial aid which is given by a government to an industry to help it compete with other units A. Incentive. B. Subsidy. C. Bounty. D. Concession.

Description : The term ___________ denotes bonus or financial aid which is given by a government to an industry to help it compete with other units A. Incentive. B. Subsidy. C. Bounty. D. Concession.

Last Answer : C. Bounty.

SIPCOT's financial assistance is in the form of __________. A. term loan. B. seed capital scheme. C. underwriting the capital issues. D. All of the above.

Description : SIPCOT's financial assistance is in the form of __________. A. term loan. B. seed capital scheme. C. underwriting the capital issues. D. All of the above.

Last Answer : D. All of the above.

SFC is prohibited from granting financial assistance to any company whose aggregate paid up capital exceed__________. A. 1 crore. B. 1.5 crores. C. 2 crores. D. 2.5 crores.

Description : SFC is prohibited from granting financial assistance to any company whose aggregate paid up capital exceed__________. A. 1 crore. B. 1.5 crores. C. 2 crores. D. 2.5 crores.

Last Answer : A. 1 crore.

To provide financial assistance to entrepreneurs the government has set up a number of___________. A. financial advisors. B. financial intermediaries. C. Industrial estates. D. financial institutions.

Description : To provide financial assistance to entrepreneurs the government has set up a number of___________. A. financial advisors. B. financial intermediaries. C. Industrial estates. D. financial institutions.

Last Answer : D. financial institutions.

Someone legally appointed to resolve the financial difficulties of an insolvent firm is called____________. A. an administrator. B. a predator. C. an auditor. D. a turnaround consultant.

Description : Someone legally appointed to resolve the financial difficulties of an insolvent firm is called____________. A. an administrator. B. a predator. C. an auditor. D. a turnaround consultant.

Last Answer : A. an administrator.

Which of the following is the reason for business failure __________. A. Lack of market research. B. Poor financial control. C. Poor management. D. All the above.

Description : Which of the following is the reason for business failure __________. A. Lack of market research. B. Poor financial control. C. Poor management. D. All the above.

Last Answer : D. All the above.

Which could provide an individual with the motivation to start a new business venture? A. The financial rewards. B. A desire to be independent. C. Risk taking D. All the above.

Description : Which could provide an individual with the motivation to start a new business venture? A. The financial rewards. B. A desire to be independent. C. Risk taking D. All the above.

Last Answer : D. All the above.

_____________ may be defined as the excess of present value of project cash inflows over that of out flows. A. Net present value technique. B. Average rate of return. C. Benefit-Cost ratio. D. Internal rate of return

Description : _____________ may be defined as the excess of present value of project cash inflows over that of out flows. A. Net present value technique. B. Average rate of return. C. Benefit-Cost ratio. D. Internal rate of return

Last Answer : A. Net present value technique.

________ are financial markets for the buying and selling of long-term debt or equity-backed securities. A. Bullion Market B. Capital Market C. Money Market D. All of the Above E. None of the Above

Description : ________ are financial markets for the buying and selling of long-term debt or equity-backed securities. A. Bullion Market B. Capital Market C. Money Market D. All of the Above E. None of the Above

Last Answer : B. Capital Market Explanation: Capital market is a market where buyers and sellers engage in trade of financial securities like bonds, stocks, etc

Which of the following is not one of the primary concerns in the Finance Department? a. Acquiring the capital needed for company activities. b. Establishing a dividend policy that maximizes the return to shareholders. c. Setting accounts payable and accounts receivable policies. d. Driving the financial structure of the firm, its relationship between debt and equity. e. Deciding promo and sales budget

Description : Which of the following is not one of the primary concerns in the Finance Department? a. Acquiring the capital needed for company activities. b. Establishing a dividend policy that maximizes the ... structure of the firm, its relationship between debt and equity. e. Deciding promo and sales budget

Last Answer : e. Deciding promo and sales budget

The small scale unit wishing to export has to obtain exporters code number from _________. A. The Reserve Bank of India. B. The Central Bank of India. C. Any Regional Bank. D. Any International Bank.

Description : The small scale unit wishing to export has to obtain exporters code number from _________. A. The Reserve Bank of India. B. The Central Bank of India. C. Any Regional Bank. D. Any International Bank.

Last Answer : A. The Reserve Bank of India.

The application for registration of a small scale unit should be submitted to the _______ . A. General manager, DIC. B. Director, DIC. C. General manager. NSIC. D. Director, NSIC.

Description : The application for registration of a small scale unit should be submitted to the _______ . A. General manager, DIC. B. Director, DIC. C. General manager. NSIC. D. Director, NSIC.

Last Answer : A. General manager, DIC.

In backward areas, term loans for expansion or setting up a new unit are available at __________ . A. concessional terms. B. differential terms. C. standard terms. D. specific terms.

Description : In backward areas, term loans for expansion or setting up a new unit are available at __________ . A. concessional terms. B. differential terms. C. standard terms. D. specific terms.

Last Answer : A. concessional terms.

______ is the opinion of the rating agency on the relative ability and willingness of the issuer of the debt instrument to meet the debt service obligation as and when the arise. (a) merit rating b) credit rating c) rating by merchant banker )

Description : ______ is the opinion of the rating agency on the relative ability and willingness of the issuer of the debt instrument to meet the debt service obligation as and when the arise. (a) merit rating b) credit rating c) rating by merchant banker )

Last Answer : (a) merit rating

A provisional SSI registration certificate is valid for a period of __________. A. four Years. B. three Years. C. two Years. D. one year.

Description : A provisional SSI registration certificate is valid for a period of __________. A. four Years. B. three Years. C. two Years. D. one year.

Last Answer : D. one year.

Mr. Xavier invested a certain amount in Debit and Equity funds in the ratio of 4 : 5 respectively. At the end of one year, he earned a total dividend of 30% on his investment. After one year he reinvested the amount including dividend in the ratio of 6 : 7 in Debt and Equity Funds. If the amount reinvested in Equity Funds was Rs. 94,500/-, what was the original amount invested in Equity Funds? (a) Rs. 75,000/- (b) Rs. 81,000/- (c) Rs. 60,000/- (d) Rs. 65,000/- (e) None of these

Description : Mr. Xavier invested a certain amount in Debit and Equity funds in the ratio of 4 : 5 respectively. At the end of one year, he earned a total dividend of 30% on his investment. After one year he reinvested the amount including ... . 81,000/- (c) Rs. 60,000/- (d) Rs. 65,000/- (e) None of these

Last Answer : (a) Rs. 75,000/-

_________ is also known as working capital ratio. (a) Current ratio (b) Quick ratio ((c) Liquid ratio (d) Debt-equity ratio

Description : _________ is also known as working capital ratio. (a) Current ratio (b) Quick ratio ((c) Liquid ratio (d) Debt-equity ratio

Last Answer : (a) Current ratio

Which one of the following statements is correct concerning the weighted average cost of capital (WACC)? a) The WACC may decrease as a firm's debt-equity ratio increases. b) In the computation of WACC, weight assigned to the preferred stock is based on the coupon rate multiplied by the par value of the stock. c) A firm's WACC will decrease as the corporate tax rate decreases. d) The weight of the common stock used in the computation of the WACC is based on the number of shares outstanding multiplied by the book value per share.

Description : Which one of the following statements is correct concerning the weighted average cost of capital (WACC)? a) The WACC may decrease as a firm's debt-equity ratio increases. b) In the computation of ... of the WACC is based on the number of shares outstanding multiplied by the book value per share.

Last Answer : a) The WACC may decrease as a firm's debt-equity ratio increases.

. If debt equity ratio is 3:1; the amount of total assets are Rs.20 lakh; current ratio is 1.5:1 and owned funds are Rs.3 lakh. What is the amount of current assets? a) Rs.5 lakh b) Rs.3 lakh c) Rs.12 lakh d) Rs.15 lakh

Description : . If debt equity ratio is 3:1; the amount of total assets are Rs.20 lakh; current ratio is 1.5:1 and owned funds are Rs.3 lakh. What is the amount of current assets? a) Rs.5 lakh b) Rs.3 lakh c) Rs.12 lakh d) Rs.15 lakh

Last Answer : c) Rs.12 lakh

Debt equity ratio is a-------------------------------------- a) Profitability ratio b) Turnover ratio c) Short term solvency ratio d) Long term solvency ratio

Description : Debt equity ratio is a-------------------------------------- a) Profitability ratio b) Turnover ratio c) Short term solvency ratio d) Long term solvency ratio

Last Answer : d) Long term solvency ratio

Ratio to assess the short term debt paying capacity of a firm is---------- a) Debt equity ratio b) Propriety ratio c) Liquid ratio d) Solvency ratios

Description : Ratio to assess the short term debt paying capacity of a firm is---------- a) Debt equity ratio b) Propriety ratio c) Liquid ratio d) Solvency ratios

Last Answer : c) Liquid ratio

Satisfactory level of debt equity ratio is -------------------- a) 1:1 b) 3:1 c) 2:1 d) 1:2

Description : Satisfactory level of debt equity ratio is -------------------- a) 1:1 b) 3:1 c) 2:1 d) 1:2

Last Answer : c) 2:1

Debt equity ratio is an example of ---------------- ratios a) Balance sheet ratio b) Profit & loss account ratio c) Mixed ratio d) Liquidity ratio

Description : Debt equity ratio is an example of ---------------- ratios a) Balance sheet ratio b) Profit & loss account ratio c) Mixed ratio d) Liquidity ratio

Last Answer : a) Balance sheet ratio