Factors Affecting Choice of Source of Funds

Q.

"Finance is the life blood for business enterprises".Explain briefly the significance of business finance.

Q.

What Is the Primary Goal of Financial Management?

Q.

Define business finance.

Q.

Explain the nature and significance of business finance.

Q.

What are the 3 areas of business finance?

Q.

What are the types of business finance?

Q.

The directors of a company have decided to modernise the plant and machinery at an estimated cost of rupee one crore. State the merits and demerits of issuing equity shares for the purpose.

Q.

What are sources of business finance?

Q.

An effective appraisal of various sources must be instituted by the business to achieve its main objectives.

1. False

2. True

Q.

________________ hold large amounts of information about the trading histories of the firms.

1. All of the above

2. Factors

3. Directors

4. Shareholders

Q.

There is least risk in equity as the share capital has to be repaid only at the time of winding up and dividends need not be paid if no profits are available.

1. True

2. False

Q. How is finance a problem for small business?

1. Many units lack the credit worthiness required to raise as capital from the capital markets and thus, depend on exploitative local financial resources
2. All of the above
3. The units frequently suffer from lack of adequate working capital, either due to delayed payment of dues or locking up of capital in unsold stocks.
4. Banks do not lend money without adequate collateral, guarantees or margin money, which they are not in a position to provide

Q. A sound financial plan is the key to Success of sound financial management of the company.

Q. Cost of equity share capital is more than cost of debt because _________________.

1. face value of debentures is more than face value of shares
2. equity shares have higher risk than debt
3. equity shares are easily saleable
4. All of the above