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Roll No. Total No.

of Pages: 02
Total No. of Questions: 09

BBA (2012 & Onwards Batches)/Bachelor in Service Industries Management


(SIM) (2014 & Onwards)/B.Sc. Business Economics (BBE) (2015 onwards)
(Sem. – 4)
FINANCIAL MANAGEMENT
M Code: 71204
Subject Code: BBA/BBE-402
Paper ID: [A2372]
Time: 3 Hrs. Max. Marks: 60

INSTRUCTIONS TO CANDIDATES:
1. SECTION-A is COMPULSORY consisting of TEN questions carrying TWO marks each.
2. SECTIONS-B consists of FOUR Sub-sections : Units-I, II, III & IV.
3. Each Sub-section contains TWO questions each, carrying TEN marks each.
4. Student has to attempt any ONE question from each Sub -section.

SECTION A
o m
1. a) What is the need of financial manager?
b) What are the limitations of agency cost? .r c m
p e
c) How equity capital differs from preference capital?
o
a
d) Discuss in detail NI approach.

p .r c
r
e) Define profitability index method.

b
f) What do you mean by profit maximization?

p e
g) Define preference capital.
a
rp
h) Define financing decision.
i) Define Internal rate of return method.

b
j) How capital structures differ from financial structure?

M-71204 Page 1 of 2
SECTION B
UNIT I
2. Discuss in detail objective, function and scope of financial management. What have been
the key developments and reforms of the Indian financial sector since 1990?
3. What do you mean by long term financial resources? Discuss in detail method with which
you can mobilize your financial resources.

UNIT II
4. Discuss in detail capital budgeting process and estimation of project cash flow. What are the
advantages of capital budgeting?
5. The expected cash flows of a project are as follows:

year 0 1 2 3 4 5

Cash flow -100,000 20,000 30,000 40,000 50,000 30,000

o m
The cost of capital is 12%. Calculate the net present value, internal rate of return, modified

.r c
internal rate of return, payback period and discounted payback period.

p eUNIT III

o m
.r c
6. What do you mean by capital structure? Discuss in detail theories of capital structure.
7.
a
What do you mean by the equity shares and preference share? Explain the feature of equity

p
shares and preference share. What are the pros and cons of equity shares from the

b r
preference share in India?
p e
company’s and investor’ point of views? What is common between equity shares and

UNIT IV
a
rp
8. Define working capital. Discuss in detail objectives of working capital. Discuss in detail
operating cycle approach to working capital and cash management.
9.
b
Explain the position of M-M on the issue of an optimum capital structure, ignoring the
corporate income taxes. Use an illustration to show how homemade leverage by an
individual investor can replicate same risk and return as provided by the levered firm.

M-71204 Page 2 of 2

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