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Questions:

1. What is Financial Management?
2. What is the modern approach of finance function?
3. Distinguish between Net Present Value and Internal Rate of Return.
4. What do you mean by Risk and Uncertainty in Capital Budgeting?
5. Describe the sources of short term finance.
6. What is meant by Traditional approach of Capital structure?
7. Distinguish between relevance and Irrelevance theory of Dividend decisions.
8. How is the cost of Equity computed under capital assets pricing model?
9. Discuss the nature and scope of Financial Management.
10. Explain with suitable examples how wealth maximization objective is superior to profit maximization objective.
11. Define Capital rationing. How would projects be ranked under capital rationing? Does Capital rationing lead to optimal investment decisions?
12. What are the various sources of long term finance? Explain.
13. Explain the Modigliani-Miller approach. What are the limitations of this approach?
14. How is Weighted Average cost of capital computed? Distinguish between book value weight, market value weight and Marginal value weight.
15. Walter and Gordon's models of dividend are based on the same assumptions. Thus, there is no basic difference between these two models. Do you agree? Give arguments in support of your answer.