Fall 2010

Master of Business Administration- MBA Semester 2

MB0045 – Financial Management - 4 Credits
(Book ID: B1134)
Assignment Set- 1 (60 Marks)

Note: Each question carries 10 Marks. Answer all the questions.

Q.1 Write the short notes on 5X2= (10 Marks)

1. Financial management
2. Financial planning
3. Capital structure
4. Cost of capital
5. Trading on equity.

Q.2 a. Write the features of interim divined and also write the factors (08 Marks)
Influencing divined policy?
b. What is reorder level ? (02Marks)
Q.3 Sales Rs.400, 000 less returns Rs 10, 000, Cost of Goods Sold Rs 300,000,
Administration and selling expenses Rs.20, 000, Interest on loans Rs.5000, (10 Marks)
Income tax Rs.10000, preference dividend Rs. 15,000, Equity Share Capital
Rs.100, 000 @Rs. 10 per share. Find EPS.
Q.4 What are the techniques of evaluation of investment? (10 Marks)
Q.5 What are the problems associated with inadequate working capital? (10 Marks)
Q.6 What is leverage? Compare and Contrast between operating (10 Marks)
Leverage and financial leverage
 Fall 2010

Master of Business Administration- MBA Semester 2

MB0045 – Financial Management - 4 Credits
(Book ID: B1134)
Assignment Set- 2 (60 Marks)

Note: Each question carries 10 Marks. Answer all the questions.

Q. 1 Discuss the three broad areas of Financial Decision Making (10 Marks)
Q.2 What is the future value of an annuity and state the formulae for (10 Marks)
future value of an annuity
Q.3 The equity stock of ABC Ltd is currently selling for Rs 30 per share. The dividend expected
next year is Rs 2.00. the investors required rate of return on this stock is 15 per cent. If the
constant growth model applies to ABC Ltd, What is the expected growth rate? (10 Marks)
Q.4 State the assumptions underlying the CAPM model and MM model (10 Marks)
Q.5 Write the cash flow analysis? (10 Marks)
Q.6 The following two projects A and B requires an investment of Rs 2, 00,000 each. The
income returns after tax for these projects are as follows: (10 Marks)
Year Project A Project B
1 Rs. 80,000 Rs. 20,000
2 Rs. 80,000 Rs. 40,000
3 Rs. 40,000 Rs. 40,000
4 Rs. 20,000 Rs. 40,000
5 Rs. 60,000
6 Rs. 60,000

Using the following criteria determine which of the projects is preferable.