M.Com (Semester III) (CBCS) Examination Nov/Dec-2018
BUSINESS FINANCE (Compulsory Paper IV)
Time: 2½ Hours Max. Marks: 70
Instructions: All questions are compulsory.
All questions carry equal marks.
Q.1 Choose the alternatives given below. 14
According to Mr. Henry Hoagland the finance function is the process of
by a business.
acquiring funds utilizing funds
both a and b above none of the above
The forms of Foreign Direct Investment are
Wholly owned subsidiary Joint ventures
Acquisitions All of these
Savings generated internally in the form of retained earnings by the
process of ploughing back of profits is known as
external financing self-financing
public deposit none of these
fund combine features of open-ended and closed-ended fund.
Interval Growth
Income Balanced
The amount of internal funds available for self-financing depends on
earning of the company
dividend policy of the company
depreciation policy of the company
All of the above
Proposals attracting compulsory licence for foreign collaborations require
approval from
.
Government Reserve Bank of India
Securities Exchange Board of India None of these
A business firm is said to be overcapitalized when
a fair return is not realized on capitalization
a business has more net assets than it really needs
both a and b above
None of the above
Which of the capitalization theory correlates the value of company
directly with its earning capacity?
Cost Theory Earning Theory
Both a and b above None of the above
The most economical and convenient source of external financing is
loans bonds
debentures public deposits
Page 2 of 2
SLR-CS-41
10) Issue of variety of corporate securities makes the financial plan
complex simple
flexible ideal
11) Bilateral or trilateral agreement between the concerned Governments of
two countries is the best example of foreign capital.
official direct
private indirect
12) is the joint venture which is owned and managed jointly by a
domestic entrepreneur and foreign entrepreneur.
Foreign Capital Foreign collaboration
Domestic participation Internal participation
13) do not create any charge on the assets of a company.
Bank Loan Bonds
Debentures Equity shares
14) Conservation dividend policy is one of the causes of
Over-capitalization Under-capitalization
Optimum-capitalization Fair-capitalization
Q.2 Write short notes.
Objectives of business finance 07
Cost theory of capitalization 07
Q.3 Write short answer of the following.
State the various methods of mutual funds. 07
Give the characteristics of sound financial plan. 07
Q.4 State the various short term and medium term sources of business
finance.
14
OR
What is 'Under-capitalization'? Explain causes of under-capitalization. 14
Q.5 What do you mean by 'foreign capital'? Explain the role and importance
of foreign capital.
14
OR
Define the term 'Public Deposits'. State the advantages and
disadvantages of public deposits.