Maharashi Dayanand University (MDU) 2008 M.B.A FINANCIAL MANAGEMENT - Question Paper

Unit-I


1. How is the goal of wealth maximization a better operative criterion than profit maximization?
2. “Incorporation of time value of money helps financial manager in taking better decision”. Illustrate.
Unit-II
3. “The sole objective of the management when making investment decisions is to maximize the net current value of
the firm”. Comment.
4. Define cost of capital. What is the relevance and significance of cost of capital in capital budgeting decision?
Unit-III
5. Explain with suitable example the arbitrage process of MM approach to achieve the equilibrium level.
6. “According to Walter’s model the optimum payout ratio can either be zero or 100 percent”. discuss the
circumstances when this is actual.
Unit-IV
7. Explain the concept of working capital. What methods do you suggest for estimating working capital needs?
Illustrate your answers
8. Write short ans of the following:
(a)Credit terms and credit standards
(b) Economic Order volume.

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