```
Question. An equation in which total assets are multiplied to profit margin is classified as
```
- du DuPont equation
- turnover equation
- preference equation
- common equation

```
Question. An equity multiplier is multiplied to return on assets to calculate
```
- return on assets
- return on multiplier
- return on turnover
- return on stock

```
Question. An increase in interest rate leads to decline in value of
```
- junk bonds
- outstanding bonds
- standing bonds
- premium bonds

```
Question. An increase in marginal cost of capital and capital rationing are two arising complications of
```
- maximum capital budget
- greater capital budget
- optimal capital budget
- minimum capital budget

```
Question. An increase in value of option leads to low present value of exercise cost only if it has
```
- low volatility
- interest rates are high
- interest rates are low
- high volatility

```
Question. An individual stock required return is equal to risk free rate plus bearing risk premium is an explanation of
```
- security market line
- capital market line
- aggregate market line
- beta market line

```
Question. An inexpensive and easy business formation and few government regulations are advantages of
```
- private corporation
- personal ownership
- proprietorship
- personal business

```
Question. An inflation free rate of return and inflation premium are two components of
```
- quoted rate
- unquoted rate
- steeper rate
- portfolio rate

```
Question. An indication in a way that variance of y-variable is explained by x-variable which is shown as
```
- degree of dispersion is one
- degree of dispersion is two
- degree of dispersion is three
- degree of dispersion is four

```
Question. An inflation rate included in bonds interest rate is one which is inflation rate
```
- at bond issuance
- expected in future
- expected at time of maturity
- expected at deferred call

```
Question. An initial cost is $6000 and probability index is 5.6 then present value of cash flows will be
```
- 25000
- 28000
- 33600
- 30000

```
Question. An interest rate is 5%, number of period are 3, and present value is $100, then future value will be
```
- 115.76
- 105
- 110.25
- 113.56

```
Question. An interest rate which is paid by firm as soon as it issues debt is classified as pre-tax
```
- term structure
- market premium
- risk premium
- cost of debt