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Capital Budgeting and Capital Ratioining Quiz

Total questions: 10

Worksheet time: 6mins

Name
Class
Date
1.

If PI of the Project A is 1.2 ; Project B is 1.1 ; Project C is 1.4 and Project D is 1.8 then Rank will be as ______

a)

A,C,B,D

b)

D,C,A,B

c)

C,D,B,A

d)

B,D,C,A

2.

If PI of the Project is 1.2 and Cash outflow is Rs 4 Lakh then cash Inflow is ____

a)

Rs 4,00,000

b)

Rs 5,00,000

c)

Rs 6,00,000

d)

Rs 4,50,000

3.

If PVCIF is Rs 8,50,000 and PVCOF is Rs 4,50,000 then NPV is ______

a)

Rs 4,00,000

b)

Rs 40,000

c)

Rs 40,00,000

d)

Rs 13,00,000

4.

Under risk adjusted cut off rate method.

a)

Higher the risk higher would be discount rate.

b)

Lower the risk, lower would be the discount rate.

c)

Both (a) and (b)

d)

None of the above

5.

___________ is the planning process used to determine whether an organization long term investments

a)

Capital Rationing

b)

Capital Budgeting

c)

Cost of Capital

d)

Leverage

6.

If the current Yield of government Bond is 5% and the risk is 3% then Risk Adjusted Discounting Rate is _____

a)

8%

b)

2%

c)

11%

d)

15%

7.

Probability gives us accurate results if it is ____

a)

Objective

b)

Multiplicative

c)

Adjective

d)

subjective

8.

In sensitivity Analysis _______

a)

Most sensitive Variable is found out

b)

Most insensitive Variable is found out

c)

sensitivity of human factor is identfied

d)

None of the above

9.

Formula for Standard deviation is _____

a)

Squareroot of variance

b)

square of Variance

c)

Multiplication with Probability

d)

Divide with Variance

10.

If Standard deviation is 16 then variance is ____

a)

256

b)

8

c)

4

d)

32