1. _________________ is a long term planning for financing proposed capital outlay.

A) Capital Budgeting.
B) Budgeting.
C) Cash Budget.
D) Sales Budget.



2. Initial outlay 50,000, life of the asset 5 yrs, estimated annual cash flow 12,500, IRR = ____________.

A) 5%
B) 6%
C) 8%
D) 10%



3. Which form of market efficiency states that current security prices fully reflect all information, both public and private?

A) Weak.
B) Semi-strong.
C) Strong.
D) Highly strong.



4. __________ of debt capital is a factor in favor of using more debt capital.

A) Tax advantage.
B) Debt equity norms.
C) Leverage effect.
D) Security of assets.



5. Security of assets is determining factor for using ________.

A) Debt capital.
B) Equity capital.
C) Preference capital.
D) Cost of capital.