Learning A New Language Education Essay

I love linguistic communication because it carries beauty and idea. Like many non-English talkers, I have begun analyzing English rather tardily in 7th grade.A To most non-English talkers, larning a new linguistic communication, English, is both fresh and disputing. Many pupils may research English with the wonder toward a new linguistic communication and civilization ; nevertheless, they may lose their involvement because of inappropriate and stiff instruction attacks, or an unfamiliar/ insecure sense towards a new linguistic communication or culture.A My induction of English survey originated from my compulsion to literary aestheticism. It was a bit-by-bit aesthetic pilgrim's journey to the glorious castle of western literature, when I started from ABC on, so read simple transitions, subsequently moved onto the beautiful essays and poesy and at last plunged into the classics by literary Masterss. A A Learning a new linguistic communication is non an easy occupation particularly for adolescents or grownups who have passed their critical period of linguistic communication acquisition. Language larning ever takes forbearance ; furthermore, it needs good schemes, motive, and a good teacher to assist pupils to get the better of the sense of disaffection toward a new linguistic communication or civilization. And as an English-major, it happens all the clip that my relations and neighbours would inquire me inquiries such as: â€Å" what do we make to larn English good? A What are your schemes? . My reply is ever: â€Å" oh, English acquisition takes merely forbearance and pattern. â€Å" A Though it ‘s true that English larning takes great forbearance and difficult working, I wish I could offer them more effectual ways and portion my experiences with them.A But I ca n't because IA cognize how to larn English, but I ca n't state people the rules and the grounds why we learn English by utilizing certain schemes or attacks. When I came to college and majored in English Literature at University of Dammam in Saudi Arabia, the literature and the lingual classs helped me a batch in understanding my early linguistic communication acquisition experiences. The joy of reading English and composing English Inspired by the strong inner call of self-exploration and the will to assist my friends reinforced my already deep love for English linguistic communication as a whole. It convinced me that I would be willing to do painstaking attempts whatsoever every bit long as I could maintain bettering my bid of this absorbing linguistic communication. I am confident that my abilities, competency, and public presentation rank manner above my academic GPA which was low due to household fortunes that I went through during my undergraduate surveies. This is apparent by having a scholarship from the Saudi Arabian authorities to prosecute my alumnus surveies at your college. After my graduation, I worked with Alamiah institute for computing machine and engineering in Saudi Arabia as an English instructor for two old ages and eight months.I started working with them from 03/2007 until 11/2009.The foremost six months they gave me courses from the teacher preparation plan, which gave me an overview of learning methodological analysiss, larning psychological sciences, and practical training.A A In category, some instructors shared with me their instruction experiences, their point of views towards the current instruction system and tendencies, whereas other instructors shared with me their doctrines of life.A Thankss to their attempts, I have come to recognize that learning is non merely the bringing of cognition, but besides the attempt to portion with, to impact, or to assist people. A My aspiration is to prosecute a alumnus plan at Nazareth College because it offers the flexibleness needed for an in-depth apprehension of learning English. I have browsed through your web site and noticed that your TESOL plan has a strong focal point on intercultural communicating and on the interaction of societal behaviour and linguistic communication usage. I am besides eager to work under the counsel of the distinguished module members of Nazareth College such as Dr.Rui Cheng whom I had met before I applied for TESOL plan. I am convinced that the installations of TESOL plan at Nazareth College will be really utile for dedicated engagement in research undertakings. I believe that a alumnus plan in TESOL at Nazareth College will assist me make my ends. I am certain that I will be able to utilize my possible to the fullest if I have the chance to come in your plan. Your plan provides classs that cover methods of instruction, rating, and stuffs development, every bit good as engage in fieldwork both as coachs and pattern teachers.A I believe the plan offered will assist me get the versatility needed to make my full potency as an English teacher.A It would be a privilege to be able to procure admittance to prosecute alumnus surveies with you. Ghadeer Saleh Alrazqan

Luxury brands growth in India Essay

Lack of quality luxury space, environment and dearth of high street or super premium malls is a prime reason for restricted presence of luxury brands in India, thus there is a dire need for modernized and dedicated luxury retail areas in protected vicinities such as airports, according to a recent ASSOCHAM-KPMG joint study. â€Å"Setting up stores in high streets affects luxury retailers’ profitability due to sky-rocketing rental costs, moreover, high streets are very cluttered, crowded and are unsuitable due to the absence of exclusive ambience that luxury retail demands,† according to a study on ‘Challenges highlighted by luxury retailers in India,’ jointly conducted by The Associated Chambers of Commerce and Industry of India (ASSOCHAM) and KPMG. The Indian luxury market grew at a healthy rate of 30% to reach $8. 5 billion in 2013 and is likely to continue growing at a healthy pace of about 20%, and reach $14 billion by 2016 owing to rising number of wealthy people, growing middle class, affluent young consumers and other related factors. Though, India currently enjoys just one-two per cent share in the global luxury market but it is the fifth most attractive market for international retailers. Fragmented and diversified consumer base in India is another significant challenge being faced by luxury retailers in India as high net worth individual ( HNI) consumers are not easy to reach, noted the ASSOCHAM-KPMG study. Luxury brands need to strategically design their growth plans to tap demand across three categories of HNIs, namely – the inheritors (traditionally wealthy) who are habitual spenders; the professional elite who are discerning spenders; a large segment of business giants (entrepreneurs, owners of small and medium enterprises) who have the money but lack appreciation for fine luxury goods because of no prior exposure to such products, it added. â€Å"There is a need for luxury brands to focus on expansion in the type and nature of products being offered and increasingly adopt innovative marketing plans to tap rapidly evolving consumer behavioral trends,† said Mr D. S. Rawat, secretary general of ASSOCHAM while releasing findings of the study. â€Å"Luxury retailers need to plan out of the box marketing strategies and come up with products that are tailor-made to suit the whims and fancies of varied Indian customers,† said Rawat. † Luxury is no longer a ‘status symbol’ but is now a lifestyle and the global brands need to fast evolve and learn ways to adapt within the local environment so that they can get accustomed to nuances of the market by understanding the cultural identity of Indian consumers. † Lack of policy support is another prominent challenge being faced by luxury brands in India, noted the ASSOCHAM-KPMG study. â€Å"Despite strong demand momentum, Indian luxury market has not been viewed as policies and regulations friendly for the luxury retailers,† the report said. † Import duties (20-150 per cent) are relatively higher and this is considered as a key apprehension factor among the international players, who may resist them to frame aggressive growth plans for India,† noted the study. Clauses such as 100% foreign direct investment (FDI) in both single and multi-brand retail requires 30% of local sourcing, announced in the liberalized FDI policy in luxury retail in November 2013 could be difficult for the international luxury players to comply with. â€Å"The duties are manifold ranging from customs’ duty, counter veiling duty (CVD), special additional tax, education cess adding to the overall cost,† said Rawat. Besides, luxury retail is also affected by the system of ‘maximum retail price’ as it applies to custom duties and to cascading ‘after the custom’ taxes, thereby heavily penalizing foreign brands pushing their overall entrance costs by up to 40%. Lack of trained staff is another well-acknowledged challenge facing Indian luxury retail industry which requires greater discretion and knowledge on the part of a salesperson, further highlighted the ASSOCHAM-KPMG study. â€Å"Shortage of skilled labour for the industry is a major cause of concern as it is difficult to make the local workforce understand the heritage and legacy of the brand along with the specific finishes involved in the manufacturing process,† said Rawat. In the absence of these requisite skill sets, brands have no option but to manufacture in their country of origin; lack of skilled workers can also be attributed to the sales function where presentation and interpersonal skills form an integral element for the business. Growing prevalence of counterfeit luxury goods and a grey market are also hampering the growth of the industry, noted the ASSOCHAM-KPMG study. Most of these products belong to segments such as apparel, perfumes and accessories, which are usually lower ticket items and can be easily placed in grey channels. â€Å"Luxury players in India continue to face supply side issues such as legal loopholes pertaining tointellectual property rights, inadequate means to monitor various emerging channels, and a growing number of online portals, among other factors,† the study added. A collective, industry wide effort is likely to have a far-reaching impact in dealing with the issue – as seen in other industries such as films and music. Awareness and collaboration also needs to be built with authorities, who have experienced major revenue losses   due to loss of taxes and duties, on how to deal with counterfeits, further suggested the study to counter the growing menace of counterfeit luxury products. â€Å"Corrective measures need to be taken to banish the growth of grey luxury goods’ market in India which results in sizeable revenue losses for firms,† said Rawat, and added that a strong legal structure combined with effective framework of intellectual property protection would help prevent dilution of brand image and reduced consumer trust. â€Å"Measures in form of effective intellectual property enforcement, plugging loopholes in the legal and judicial structure and higher conviction rates can help curb the growth of fake luxury products,† said Rawat. Information collected through secondary sources such as internet and local newspapers†¦

Digital marketing presents opportunities and challenges to Essay - 2

Digital marketing presents opportunities and challenges to organisations - Essay Example 198). Yet, to obtain the advantages of digital marketing, organisations should add interactive media into their current marketing and business strategies, which is not easy to accomplish. Many companies are having difficulties developing their digital marketing strategies. Studies are being carried out to identify new marketing tools that will contribute to the development and implementation of digital marketing tools. The intention of this discussion is to describe the opportunities and challenges presented by digital marketing to today’s companies by using two concrete examples, Amazon and American Airlines’s SABRE. Various scholars and researchers have identified and described the opportunities and challenges of digital marketing. Digital marketing has created new means or outlets for advertising, selling, and buying. It allows the customer to access an incredible amount of information in an accessible and convenient way. Customers have the chance to look at products and/or services based on their wanted features, such as price, quality, functionality, and others. Customers can use it to get product reviews, or to know about the experiences, opinions, and/or ideas of other users (Urban 2004, 18). Digital marketing has given the end user some control, bringing about an enormous change in marketing processes. By using digital marketing companies can gain competitive advantage through greater customer satisfaction. In addition, digital marketing could be a simple tool for companies since the ‘digital’ feature of marketing allows further technology advances. Because the Internet facil itates two-way communication directly and quickly, implementing digital marketing strategy can occur faster than earlier marketing tools and are at times less costly. The best feature of digital marketing is its ‘instantaneousness’, hence allowing quick response from customers (Morris 2002, p. 205). On the

How is immigration affecting the united states Research Proposal

How is immigration affecting the united states - Research Proposal Example Scholar denotes that prior to the year 1965, the formula used for admitting immigrants into the United States was only restricted to people from Western Europe. Anderson (36) further goes on to denote that on a historical note, naturalization and immigration has always been limited to people who are white, i.e. the Caucasians. However, this ethnic and racial allocation of came to an end during the periods of the 1960s. This is because of the emergence of the civil rights movements, which greatly advocated for the rights of the minority, and the racially disadvantaged people (Heyman, 11). Because of this civil rights movement that occurred in the periods of the 1960s, the first generation immigrant’s number greatly increased, from about 9.6 million people in 1970, to approximately 38 million people in the year 2007. Between the years of 2000, to the year 2010, scholar denotes that the number of immigrants who entered United States was about 14 million people. Of these 14 millio n people, more than 1 million people were able to acquire citizenship through naturalization in the year 2008. Moses (324) denotes that immigration has some positive and negative effects on the American community. One of the major effects of immigration is the rise of population growth in the United States. According to an estimate by the Census Bureau, the population of United States will reach 397 million people, by the year 2050. This is when immigration is factored in this growth. On the other hand, when immigration is not factored, the bureau estimates that the population growth of the United States will only reach 328 million people. In another study carried out by Pew Research center, it estimates that the population growth of United States will reach 438 million people, from the 296 million people that it had in the year 2005. This is because of an increase of immigrants in

Teacher-Student Physical Distance Essay Example | Topics and Well Written Essays - 1750 words

Teacher-Student Physical Distance - Essay Example An art classroom is much more spatial than a normal classroom. The walls of classrooms were usually in light colors, with windows to allow enough sunlight. The posters on the walls were made of attractive colors and were arranged in a manner that is pleasant to look upon. Yes, there were differences, but there were also similarities. So I wondered, what were the reasons that classroom set-up was arranged in a particular manner? Does it influence the students’ learning? How? In particular, is the distance between the instructor and the student important? How does it affect the learning of the students? When the reasons for these set-ups are understood, then more individuals will support it – especially if it means learning efficiency. The mentors will employ this knowledge seeing that this will aid them in their endeavors to pass on knowledge to their students. Learners will also appreciate this, knowing that this will aid in them in gaining knowledge – the primar y reason why they study. LITERATURE REVIEW It has been well documented in literature that human emotions play a significant role in the way we live. We experience emotions in all of our activities, making these emotions sometimes control the activities that we engage in (Shan 142). As Shan (142) have said, â€Å"pleasant emotional experience can contribute to active and positive imitation and repetition, accompanied by pleasure, satisfaction and love etc., while the unpleasant one can cause people to behave negatively, leading to anger, complaints, hate, etc.† Since learning is also an activity that we do, emotions are therefore also important in the learning process. Classroom instruction is a communication process between the teacher and the students. Since emotions are involved here, the instructor’s emotions will affect the students just as the students’ will affect the instructor (Shan, 143). Astleitner (128) argued that influencing emotions during classroo m instruction is important as this will affect the learning of the students. The Fear Envy Anger Sympathy Pleasure or FEASP Theory is an approach that integrates emotions into classroom instruction (Astleitner 128; Astleitner, Hurek and Sztejnberg 63) saying that positive feelings (sympathy and pleasure) should be cultivated in the instructional design and conversely, avoid the negative emotions (fear, envy, anger). When Simon A. Lei (128) reviewed the literature about the effects of the physical design of a classroom to the learning of the students, he found a similar basic foundation. Though students learn in various ways, what remained the same was the fact that classrooms must be designed in such a way that positive feelings should be cultivated to empower both educators and learners. Then the various ways that students learn in the classroom will be facilitated. Seven physical attributes of a classroom that have a profound impact to student learning were identified by Lei (128- 129). First was the size of a room which could be small or large depending on the number of students on the class. Second was the furniture arrangement which could either be flexible or attached to the floor. Third was technology system arrangement in the classroom; if a modern technology was available there and where it was located. Fourth was lighting in the room; the intensity of light, its source, and if a multiple light settings were present. Fifth was the

Legal and Ethical Actions of NovaGold Resources Inc Term Paper

Legal and Ethical Actions of NovaGold Resources Inc - Term Paper Example Similar class action lawsuits were also filed in the Supreme Court of British Columbia and in the Ontario Superior Court of justice in Canada. The $28.0 million settlement was covered by insurance companies and the company did not have to payout from own resources under the terms and conditions. (Marketwire 2011) NovaGold commenced environmental studies in 1996, which consisted of Meteorology, wetlands delineation related to mineral resource estimates, aquatic studies in the main drainages, water quality studies, and some waste rock characterization. This was further expanded to terrestrial wildlife and avian surveys, detailed aquatic studies, ambient air monitoring and cultural site surveys. NovaGold is equipped fully to overcome any challenges, even though it may require more time and with the progress of work, it will start showing in the share price. NovaGold clearly understands its community responsibilities and following all environmental norms would work to get all necessary p ermits to make the project most successful and only one of its kind in the world. (Safehaven 2010) Stocks of NovaGold are traded on NASDAQ, AMEX, and New York Stock Exchange. Revenue and Income From the latest results available for the year ended Nov 30, 2010, of NovaGold Resources Inc., it is seen that revenue has fallen to C$0.6M. Surprisingly, cost of goods sold has not gone down proportionately and it has remained at C$46.3M. Losses have gone up to the tune of C$-203.5M. (NovaGold Financials 2010) Basic Financial Ratios & Industrial Comparison Return on Assets: Net Income/ Total Assets stands negative at -5.17%, on industrial comparison it stands as the 60-80th percentile. A. Return on Capital: Given as after-tax operating income by the book value of invested capital and that comes to -5.55%, on industrial comparison it stands as the 60-80th percentile. B. Return on Equity: Net Income/Shareholder's Equity stands at -34.48%, on industrial comparison it stands as the 40-60th perce ntile. Credit Ratios: A. Current Ratio: given by Current Assets/Current Liabilities stands at 5.3 times; on the industrial comparison, it stands as the 60-80th percentile. B. Quick Ratio: given as Current Assets-Inventory/Current Liabilities stands at 5.1 times; on the industrial comparison, it stands as the 60-80th percentile. Margin Ratios: A. Gross Margin: given as Revenue-Cost of goods sold/Revenue that stands at -7631.22%, on industrial comparison it stands as the 0-20th percentile. B. EBITDA Margin: -9295.16%, on industrial comparison it stands as the 0-20th percentile. Debt-Equity Ratio: Total Debt/ Total Equity stands at 20.5, on industrial comparison it stands as the 60-80th percentile. Total Liabilities/Total Assets: 23.8, on industrial comparison it stands as the 60-80th percentile. (NovaGold Resources) Sales Forecast: NovaGold is a company doing exploration activities in the field of precious metals and necessary development of mineral properties in Alaska, Canada, Briti sh Columbia and the United States. The Company spearheads its operations through wholly owned subsidiaries, partnerships, and joint ventures.

Community Health Advocacy Project Part Four Essay

Community Health Advocacy Project Part Four - Essay Example There are also protective strategies that promote risk factors and health cases (Glanz, Rimer & Lewis, 2002). The implemented strategies at this point encompass good nutrition standards and health education programs. In that aspect, the primary level of prevention is also concerned with persons who are at the point of stage susceptibility to a disease. Another one is the second level of prevention that is also called the secondary level. It lays emphasis on the early identification and prompt treatment of a disease to prevent its spread. Therefore, these measures are essential to deter serious effects that have a likelihood of occurrence in case the disease is not treated on time (Bartholomew, 2011). Alternatively, the secondary level also tackles the prevention of patients that is targeted at those facing the early stages and pre-symptomatic signs of the disease. In that case, one of the tactics for secondary prevention involves screening of the disease that affects both individuals and groups. The final level of prevention is called tertiary prevention. This always happens after the disease has just happened. It is targeted at terminating the influence of the disease and also reduces the damage to the affected individual. Tertiary prevention also deals with rehabilitative measures that assist in the improvement of body functioning that supersedes a disease. Therefore, in the case of aggregate assessment of HIV/AIDS in Belle Glade community, there are interesting issues to note. For example, the primary level of prevention also encompasses safe sex education for the population. The population should also be sensitized to engage in safe sex by always using condoms as a deterrent measure against HIV/AIDS infection (Department of Health and Human Services, 2010). Additionally, there should also be health education that informs the masses about the modes of HIV/AIDS transmission and

Enron Research Paper Example | Topics and Well Written Essays - 5000 words

Enron - Research Paper Example The company regularly featured into the most innovative firms categories across America (McLean & Elkind, 2003).   The first investigations was of their complex and private networking with off-shore partners and then into their accounting practices. Enron bankruptcy is also known as largest audit failure in the history of America. The bankruptcy further led to the Arthur Andersen’s dissolution, which at that time were world’s fifth largest accountancy and audit partnerships. Before Enron bankrupted in the year 2001, its annual revenues increased from around 9 billion dollars in 1995 to more than 100 billion dollars in 2000. The audit after the investigation revealed that the company’s financial conditions were covered largely by systematic, institutionalized as well as creatively planned ethical and accounting fraud (Deli & Gillan, 2000). Thomas (2002a) examined the drop of the stock prices of the firm, which was less than 1 dollar per share by 2001 from 90 dollars per share, before the investigation. It was also found that Enron revised its annual financial statements over the past five years in order to cover its 586 million dollar losses. It was declared bankrupt on 2nd December, 2001 (Bartlett & Glin ­ska, 2001). The current research paper will analyze the event’s details included conflicts in interests, management as well as accounting fraud. The analyzing will consist of both corporation’s perception and individual’s perception. The broader perspective of the research paper is to examine the scandal from multiple perspectives. The background of the paper has provided a summary of the scandal and situation of the company before and after the scandal. The paper will throw light on the business model that was implemented by Enron and culture, legal and moral implications of the business model that impacted the company in its later stages. Special light on the transformational and trait leadership in

Retaining Foreign Talents in the Dubai Banking Industry Dissertation

Retaining Foreign Talents in the Dubai Banking Industry - Dissertation Example Advani (2006) mentions that the said situation exists in the said country because of the fact that the employees would rather work for the foreign banking institutions as the latter offers better compensation packages than their local counterparts. The Oxford Business Group (2008) also cited attracting and retaining high quality talent as one of the most common problems experienced by banks in Bulgaria. Generally, this problem is brought about by various issues such as the competition for limited banking resources such as the location that can be used to establish banks, the availability of skilled employees and eligible clients (The Oxford Business Group 2008). In Dubai, as well as in the other members of the Gulf Cooperative Council (GCC), retaining foreign talent in their banking industry is likewise an important issue issue. During the past years, the said countries, most especially Dubai, has been considered attractive in terms of enticing expatriate professionals Nevertheless, it was only considered as relatively successful in a sense that it has merely served as a transient market wherein the young professionals begin their careers, earn tax free income and socialize for 2-3 years. In this sense, employers therein experience high rates of turnovers as regards their staff (Rehman 2007). The 2007-2010 depression which affected Dubai along with the other members of the GCC has resulted to the radical decrease in the number of expatriate workers in the said countries. True enough, many Westerners were employed four to five years ago. However, nowadays, most of them have been transferred to other countries and some have been repatriated to their own countries. More often than not, the decision involving them is brought about by the fact that foreign expatriates are more expensive than others. Undoubtedly, the members of the Gulf Cooperation Council, most especially Dubai has long relied on foreign expatriates. However, because of the economic issues that they have faced, most of them have decided to come up with initiatives which are aimed towards the localization of the workforce, replacing the foreign expatriates with skilled local employees. The adoption of these initiatives had been highly influenced by the banking institutions in the countries to cut down their expenses by reducing the compensation packages offered to the expatriate professionals. Aside from these, the decision of financial institutions to cut down the premium pay of expatriates had also facilitated their turnovers (Rehman 2007). Undoubtedly, there is a need to implement employee strategies so as to retain key employees, most especially foreign talents in a certain company. However, because of economic problems such as recession, companies tend to cut down their costs in order to cope with the financial situation. This paper focuses on the issue of expatriate management in Dubai. It focuses on the different innovative strategies that companies, most especially memb ers of the banking industry usually implement in order to retain foreign talent. However, given the fact that Dubai suffered from economic recession in the last three years, this research aims to look into whether or not ht financial institutions therein continue the implementation of the said strategies during this period in the hopes of retaining foreign talent. Statement of the Problem As previously mentioned, the adoption of pertinent employee strategies is of paramount importance in terms of retaining foreign employees. Amongst the members of the banking industry, the key to attracting and retaining employees is through the development of good payment packages. However, banking instituti

“Of mice and men is a novel that presents both the barbarity and the beauty of human nature” Essay Example for Free

â€Å"Of mice and men is a novel that presents both the barbarity and the beauty of human nature† Essay I agree with this because Steinbeck shows barbarity in the characters. One example of this is when Lennie kills Curley’s wife by accident. I know this because it says â€Å"he quickly becomes excited and holds on too tight, frightening her Lennie panics and clamps his strong hands over her mouth to silence her† This is effective because Lennie doesn’t realise that he’s killed Curley’s wife by stroking her hair but it shows that his actions were cruel and his chances of his American dream has been ruined. The words â€Å"holds on too tight† shows that Lennie had got over excited while touching/stroking one of his favourite things and he doesn’t realise that he’s held on tight and can’t restrain himself from letting go of her hair. The word â€Å"panics† shows that Lennie didn’t know what to do as soon as he heard her screaming so he couldn’t help but keep holding on to her. We can tell that Lennie doesn’t choose to be barbaric towards people but due to his simple mind he just can’t help it. Another way we know Lennie is barbaric is because of his animalistic side, Steinbeck uses the deaths of the small animals to show that despite loving to stroke nice things, he ends up killing them. Steinbeck also shows the beauty of human nature in the Novel. Examples of this is when Lennie constantly gets compared to animals with his actions. I know this because it says â€Å"He walked heavily, dragging his feet a little, way a bear drags his paws. His arms did not swing at his sides, but hung loosely.† This is effective because Lennie is being compared to an animal, a bear. A massive, sometimes violent creature. The word ‘hung loosely’ shows that he was simple minded in everything he did so he didn’t really think about the things he did. Another word ‘the way a bear drags his paws’ shows that he was compared to a bear because of his strength and movement. Another quote would be â€Å"His huge companion dropped his blankets and flung himself down and drank from the surface of the green pool; drank with long gulps, snorting into the water like a horse. The small man stepped nervously beside him† Lennie being compared to an animal b ut this time, a horse who has to be kept from drinking too much water. It at least shows that he has some responsibility to control the natural world. Another way Steinbeck shows barbarity is with the character Crooks. He gives Crooks’ character a hatred towards the men in the ranch. I know this because it says â€Å"Crooks said sharply, You got no right to come in my room. This heres my room. Nobody got any right in here but me† This is effective because it shows that Crooks didn’t like the other men because of the way they treated him so he has to be barbaric to them. The word ‘sharply’ shows that Crooks actually meant what he said although Lennie was being nice, it could also demonstrate that he wanted to take out his anger to Lennie because he realised Lennie wouldn’t understand what Crooks was actually saying to him. The word ‘nobody got any right in here’ shows that he wanted treat them the exact same way they treated him in the ranch. Crooks is barbaric because he was treated that way so he might aswell treat the others the way they’ve been treating him. In conclus ion I think Of mice and men does present the barbarity and beauty of human nature because the characters always had two sides to them whether they were happy or not so it did make the novel very interesting to read.

Relationship Between Profitability and Liquidity

Relationship Between Profitability and Liquidity CHAPTER 1: INTRODUCTION This study empirically examines the relationship between profitability and liquidity, of insurance companies in Mauritius by using regression models and correlation analysis. The goal of any business is to make profits. If it does not make profit, it will soon go out of existence. Business need to ensure that it has enough money not only to cover expenses, but ensures that something is left over. Profitability of a company can be affected by many factors, among which there is liquidity. Every stakeholder has an interest in the liquidity position of his related company. Employees are also having interest in the liquidity of their company in order to know whether the company can meet its employees related obligations that are salary, pension, and provident fund. Shareholders are interested in understanding the liquidity due to its huge impact on the profitability. One can understand the liquidity position by analyzing the financial statements of a company. Liquidity position of a company can examined through financing decisions or investment decisions. 1.1 Definition of Liquidity Liquidity is defined as the ability of a company to meet its short term obligations. It is also the ability of the company to convert its assets into cash. It is more explicitly the ability of a company to meet the cash demands of its policy and contract holders with no or negligible loss (Claire et al., 2000). The assets and liabilities of a company reflect its liquidity profile. Since liquidity risk is inherent in the financial institutions, one must be able to understand measure, monitor and manage this risk (Douglas and Raghuram, 2001). Liquidity Risk According to Claire et al., (2000), liquidity is the ability to meet expected and unexpected demands for cash through ongoing cash flow or the sale of an asset at fair market value. Liquidity risk is the risk that, at a point in time, an entity will be in short of cash or liquid assets to attain its cash obligations (Darling, 1999). This may result in a run-on-the-company event, which is an example of loss due to this risk which causes the collapse of an institution. This type of event can occur during a depression whereby most customers ask to have their cash paid immediately and that demand exceeded cash reserves. Other less dramatic losses can occur when a company needs to borrow unexpectedly or sell assets at an unanticipated low price (Stewart and Raghuram, 1998) 1.2 Profitability Profitability is defined as the ability of a company to generate income which surpasses its liabilities. Profitability is measured by different ratios such as, Return on Equity (ROE), Price to Earnings Ratio (PER) and Return on Assets (ROA) amongst others. The measurement of profitability is essential to every company (Eljelly, 2004). Insurance regulators either encourage profitability, when concerned with solvency, or seek to limit it, when regulating rates. To investors and insurers, profitability plays an essential role. To policyholders of a stock insurer, it sounds like markup, while to those insured by a mutual company, it has no impact (McClenahan, 1999). Enz and Karl (2001), state that profitability is subject to consistent and accurate determination under a given set of conventions and accounting rules. Profits are important to investors and management as sources of dividends and growth. Profits provide better security against insolvency to insurers and regulators. 1.3 Background on Insurance Sectors in Mauritius The first two insurance companies (Phoenix Assurance Company and the Commercial Union) were set up in 1835 by the British. In 1845, the Mauritius Marine Insurance was formed by Mauritian shareholders. A second Mauritian company was set up called the Mauritius Fire Insurance company in 1854. From that time till date, new companies have emerged. Presently there are 16 insurance companies operating in Mauritius. All these companies are engaged in Life business, General business or both. INSURANCE COMPANY LINE OF OPERATION Anglo Mauritius Assurance Co Ltd Life Insurance Albatross Insurance Co Ltd Life General Insurance British American Insurance Co Ltd Life General Insurance Island Life Assurance Co Ltd Life Insurance Indian Ocean General Assurance Co Ltd Life General Insurance Jubilee Insurance Mauritius Ltd Life General Insurance Llyods Mauritius Co Ltd Life General Insurance La Prudence Mauricienne Assurance Ltd Life General Insurance Lamco International Insurance Ltd Life General Insurance Life Insurance Corporation of India Life Insurance Mauritian Eagle Co Ltd Life General Insurance Mauritius Union Assurance Co Ltd Life General Insurance New India Assurance Company ltd General Insurance Swan Insurance Co Ltd General Insurance State Insurance Company of Mauritius Ltd Life General Insurance Sun Insurance Company Ltd Life General Insurance Table 1.1: List of Insurance Companies and their respective lines of operation 1.3.1 Liquidity issues in Mauritius Each insurance company has their own structures and policies to manage all the risks in their operations including liquidity. In addition, they have to abide by the guidelines on liquidity provided by the Financial Services Commission and Section 23 of the Insurance Act 2005. Insurance companies have also to develop a contingency plan which should help them manage their liquidity on a global consolidated basis. Recent technological and financial innovations have provided insurance companies new means to finance their activities and to manage their liquidity (Vittas, 2003). The liquidity of insurance companies should usually be well planned since the frequency, timing and severity of insurance claims and benefits are quite uncertain (Levene, 2003). Insurance companies obtain their liquidity through (i) Underwriting: Underwriting is calculated as premium revenues subtract payments and operating expenditures; (ii) Investment Income: Investment income consists of dividends, realized capital gains on stocks and coupon payments and principal payments on bonds and (iii) Asset Liquidation: Assets liquidation is primarily concerned with stock sales and bonds on the financial markets (Holden and Ellis, 1993). 1.4 Problem Statement The eventual measure of efficiency of the liquidity planning and control is the effect it has on profitability. The companies preference of high return on assets to increase their profitability affects their liquidity positions. As a result, a study in the insurance sector in Mauritius is carried out to confirm this statement. 1.4.1 Research Objectives The research objectives of the study are as follows: i. To assess the impact of liquidity on profitability of Mauritian insurance companies ii. To determine the relationship between liquidity and profitability iii. To evaluate the impact and significance of the different liquidity ratios on profitability 1.4.2 Aim and Objectives of the Dissertation The aim of this dissertation is to investigate the relation between profitability and liquidity within the Mauritian context, in particular in the insurance sector. An econometric model would be used for this research study. The same model will be used to test the impact of liquidity on profitability of thirteen insurance companies, namely Anglo Mauritius Assurance Co Ltd, Albatross Insurance Co Ltd, British American Insurance Co Ltd, Island Life Assurance Co Ltd, Indian Ocean General Assurance Co Ltd, Jubilee Insurance Mauritius Ltd, Llyods Mauritius Co Ltd, Lamco International Insurance Ltd, Mauritian Eagle Co Ltd, Mauritius Union Assurance Co Ltd, Swan Insurance Co Ltd, State Insurance Company of Mauritius Ltd and Sun Insurance Company Ltd. 1.5 Outline of the Dissertation 1.5.1 Chapter 1: Introduction The introduction gives an overview on liquidity risk and explains why it is an important area for research, in particular in the insurance sector in Mauritius. It gives a clear and concise statement of the aim and objectives of this dissertation. 1.5.2 Chapter 2: Literature Review This chapter is wholly a review of existing literature on liquidity and any relevant articles related to liquidity issue have been considered. This will help to put the proposed research in a relevant context and ensure that up-to-date techniques are used for the analysis in this research study. 1.5.3 Chapter 3: Methodology This chapter describes the methods and estimation techniques used to compute estimates of the parameters in the econometric model and explain the equations being used. It also outlines the sources of data collection. Finally, the limitations of the study are outlined in this chapter. 1.5.4 Chapter 4: Results and Findings Chapter 4 presents the Analysis of data and findings. Tables, graphs and figures are usually used in this chapter to better illustrate graphically the results of this research study. The data was analysed using EViews 7 and the findings will be discussed. The latter will enable comparison that will either confirm or contradict expectations. 1.5.5 Chapter 5: Conclusions and Recommendations This final chapter presents the conclusions reached based on the findings of the previous chapter. Finally, some suggestions for further research in liquidity will also be presented.

William Thomson Essay -- biographies biography bio lord kelvin

Born on June 26th 1824 in Belfast Ireland, William Thomson was one of many children. He was primarily raised by his father, James Thomson, as his mother died when he was six. James Thomson raised his family in a strict Presbyterian fashion. Although his father was strict and demanding, William mangaed to maitain a close relatioship with his father. James Thomson was the professor of engineering in Belfast and later was appointed to the chair of mathematics at the University of Glasgow. He taught his son mathematics at a very early age and as a result, William Thomson became an accomplished mathematican beyond that of universities. William Thomson enterd Glasgow University at the age of ten. That was not as uncommon as it is today because back then the universities were competing for the best junior pupils. In 1838, when Thomson was 14, he began what people today would consider university work and when he was 15, his essay called An Essay on the Figure of the Earth won him a gold medal from the University of Glasgow. Thomson then went on to publish his first papers at ages 16 and 17. These papers were defending the work of Fourier who was being criticized by british scientists. Following his years at Glasgow, Thomson entered the University of Cambrige in 1841. He graduated in four years with a B.A. honors degree and was second wrangler. Further work in 1845 saw him become first Smith's prizeman and he was elected a fellow of Peterhouse. From there he went to Paris because of his interest in the French approach to mathematics and he wanted to gain practcal experience and competence in experimental work. Before leaving Paris, Thomson got involved in many discussions which led him to study th... ...that of electrical current flow which helped him solve the problems with trasmitting electrical signals over long distances. Following this project, thomson invented the mirror galvanometer which he patented in 1858 as a long distance telegrah reciever. These projects not only led him to a great deal of fame but also a lot of money. Because of the great success he had from his work, Thomson was Knighted by QueenVictoria in 1866. He then retired from Glasgow in 1889 after being a professor for 53 years. In 1890 he became president of the Royal Society and held that position for five years and in 1892 he was created Baron Kelvin of Largs and recieved the Order of Merit in 1902. William Thomson, better know as Lord Kelvin, eventually died at his home December 17th, 1907, in his estates close to Largs, Scotland, and was buried at Wetminster Abbey, London.

No Loner Mourn For Me Explication :: essays research papers fc

William Shakespeare â€Å"No Longer Mourn For Me When I Am Dead† Explication   Ã‚  Ã‚  Ã‚  Ã‚   Read the sonnet with a sarcastic angry tone and a whole different meaning is found. He uses words and angry phrases that repeat and reflect off of each other. I believe the author does not want people to be saddened by his death. Not because he cares for the people but because he is angry. It is almost as if he sees his death as a last joke he had on them. In lines 3 and 4 he says   Ã‚  Ã‚  Ã‚  Ã‚  Ã¢â‚¬Å"Give warning to the world that I am fled,   Ã‚  Ã‚  Ã‚  Ã‚  From this vile world with vilest worms to dwell.† he repeats vile and seems to have a very angry tone. He says that this world is vile and that the people who dwell in it are worms. He has fled from that world and now he feels it is their turn to feel unwanted and angry.   Ã‚  Ã‚  Ã‚  Ã‚  In the line â€Å"Nay, if you read this line, remember not, the hand that writ it, for I love you so, that I in your sweet thoughts would be forgot, † he is being machiavellian, he points out that he loved her and is being a martyr about the fact that he thinks in her sweet thoughts she would forget him. His anger is surpassed by his death, now the one who he thought did not love him in life is stuck with out him forever because he is dead. â€Å"Do not so much as my poor name rehearse, But let your love even with my life decay,† He is saying do not think of me or speak my name after I am dead, but feel bad and let your love for me decay with his body.   Ã‚  Ã‚  Ã‚  Ã‚  Almost a suicide note of someone who is very angry, when read a certain way you can see totally different things in a poem. Last lines† Lest the wise world should look into your moan and mock you with me after I am gone.† The whole world and me are now mocking you because everyone knows what she has done.

Thermal Physics :: essays research papers

Thermal Physics – 340  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Exam #1 Due Monday, February 18th, at the start of class As discussed in class, submission of your solutions to this exam will indicate that you have not communicated with others concerning this exam. You may use reference texts and other information at your disposal. Do all problems separately on clean white standard 8.5† X 11† photocopier paper (no notebook paper or scratch paper). Write on only one side of the paper (I don’t do double sided). Staple the entire solution set in the upper left hand corner (no binders or clips). Don’t turn in pages where you have scratched out or erased excessively, re-write the pages cleanly and neatly. All problems are equally weighted. Assume we are working with â€Å"normal† pressures and temperatures with ideal gases unless noted otherwise. Make sure you list all assumptions that you use (symmetry, isotropy, binomial expansion, etc.). 1. A container has one wall which contains many small holes, and outside the container is vacuum. If the container is filled with He at pressure Po, it is found that after one hour the pressure inside the container is Po/2. The container is now filled with an equal number of He and Ne atoms to a total pressure of Po. (a). Calculate the ratio of the number of Ne to He atoms left in the container after one hour. (b). Would this problem be more difficult if the atoms were initially C and H? Explain from two standpoints, the realistic standpoint and the physics-land standpoint. The latter explanation should invoke the assumptions made in the ideal gas model, the former something you know about chemistry. (c). Explain why such a container might be useful in the case of isotopes, especially a series of such containers set up so that what comes out of the first goes into the second and so on. 2. A He and H atom collide elastically in a head-on collision. (a). If they have the same kinetic energy (KE) to begin with, which one gains KE? Answer this by calculating the amount gained and lost for both, relative to their initial value. (b). Suppose the atoms had the same mass but different kinetic energies? Do not do a detailed calculation here, but instead make a physical argument as to why the â€Å"slower† thus â€Å"cooler† atoms would slow down the faster, hotter atoms. This is one process for the moderation of hot neutrons in a nuclear fission reactor by the water used as its coolant. Thermal Physics :: essays research papers Thermal Physics – 340  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Exam #1 Due Monday, February 18th, at the start of class As discussed in class, submission of your solutions to this exam will indicate that you have not communicated with others concerning this exam. You may use reference texts and other information at your disposal. Do all problems separately on clean white standard 8.5† X 11† photocopier paper (no notebook paper or scratch paper). Write on only one side of the paper (I don’t do double sided). Staple the entire solution set in the upper left hand corner (no binders or clips). Don’t turn in pages where you have scratched out or erased excessively, re-write the pages cleanly and neatly. All problems are equally weighted. Assume we are working with â€Å"normal† pressures and temperatures with ideal gases unless noted otherwise. Make sure you list all assumptions that you use (symmetry, isotropy, binomial expansion, etc.). 1. A container has one wall which contains many small holes, and outside the container is vacuum. If the container is filled with He at pressure Po, it is found that after one hour the pressure inside the container is Po/2. The container is now filled with an equal number of He and Ne atoms to a total pressure of Po. (a). Calculate the ratio of the number of Ne to He atoms left in the container after one hour. (b). Would this problem be more difficult if the atoms were initially C and H? Explain from two standpoints, the realistic standpoint and the physics-land standpoint. The latter explanation should invoke the assumptions made in the ideal gas model, the former something you know about chemistry. (c). Explain why such a container might be useful in the case of isotopes, especially a series of such containers set up so that what comes out of the first goes into the second and so on. 2. A He and H atom collide elastically in a head-on collision. (a). If they have the same kinetic energy (KE) to begin with, which one gains KE? Answer this by calculating the amount gained and lost for both, relative to their initial value. (b). Suppose the atoms had the same mass but different kinetic energies? Do not do a detailed calculation here, but instead make a physical argument as to why the â€Å"slower† thus â€Å"cooler† atoms would slow down the faster, hotter atoms. This is one process for the moderation of hot neutrons in a nuclear fission reactor by the water used as its coolant.

Internship report outline Essay

Executive Summary (Describe where your internship was carried out shortly (company, department, location, etc. ). Summarize your internship goals, activities, and accomplishments. In addition, describe the key learning from your internship (both personal and professional)). Table of Contents Table of Figures/Tables I. Overview of Internship a. Student name, ID, program & specialization, telephone, email. b. Internship dates/Period c. Internship company name, department/division, address, contact numbers, e-mail d. Internship company supervisor’s name and position e. Internship objectives f. Job scope – Job description/duties & responsibilities (intro) g. Student’s contribution to the company h. Benefits to the individual/Student i. Student’s career interest(s) j. Problems and difficulties if any faced during the internship period k. Recommendations and suggestions (Analyze your performance during the internship. What are your three primary strengths? Give examples of what you did well. What are three areas that you would like to improve? Give examples of what you would do differently. Ask your company supervisor for input on this aspect of the report. ) II. Organization Part (on overall issues about the organization, its legal status, organizational structure, character of business activities, list of the main business operations; character of works, performed directly by the student during the internship, explain how the work done during the internship relates to your major or to your career objectives) a. Introduction (Objective, methodology, scope, limitation)Â  b. Overview of the Company c. Management Issues d. Marketing Issues e. Finance/Accounting Issues f. Operations Management and Information System Issues g. Industry and Competitive Analysis (SWOT, market dynamics, competitive dynamics) h. Observations/Findings i. Summary and Conclusions j. Recommendations III. Project Part (on a particular issue – a topic preferably related to student’s major and internship/work) a. Introduction (background, objective, significance of the issue) b. Methodology c. Findings and Analysis d. Summary and Conclusions e. Recommendations References Bibliography (List the books, articles, websites that are referred if any) Appendices (Tables, maps, government reports, conversions if any) Required size of the MBA Internship Report – not less than 25 pages without appendices, 1. 5 space, 12 font, Times New Roman Required size of the BSc Internship Report – not less than 15 pages without appendices, 1. 5 space, 12 font, Times New Roman

My Precious Place

The place can be their house, school, or an amusement park. Everyone has a different special place with different feelings. My precious place Is a hill. The hill is located In Hondo where Is a small town In Japan. I have several reasons why It Is an Important place for me: view, atmosphere, and memory. The hill Is surrounded by many nature, so I can see many trees, bushes, and the ground. They are beautiful green, but they have different greens.Some of them are pep green, and some of them are light green. From the hill, I can see the whole town of Hondo. In addition, this hill is located in the countryside, so there are always not many people. That is why, the hill is quiet. When I close my eyes, I can hear the bards singing. Moreover, I can hear cars sound which comes from far away but not so many. When a car through near hill, the sound become gradually louder, and when the car go away, the sound become gradually smaller. The sound is like ocean waves.If I hear the sound at deferen t place, I Just think car sound. However, hill's quiet atmosphere and the birds singing make the sound ocean wave to me. Finally, I have an unforgettable memory on the hill. When I go the hill for the first time, I went there with my friend whose I loved. I wanted to make a memory with him before I go to the united States, so I asked him to hang out. I thought it was the last time to meet him. The end of the date, he took me to the hill. The way to go there, we rode a bicycle together.When we arrived there, we could see a brilliant night view, and he said he loved me. The memory and the place are really important between my boyfriend and me. In conclusion, a hill is a precious place for me because there is beautiful green view, relaxing atmosphere, and it reminds me my best moment of my life. Nowadays, Japanese people are trying to make the countryside to the city, so nature is getting smaller. Because of that, the view is changing, but I hope the view from a thin hill never change.

We Googled You

We Googled You The case in the â€Å"We Googled You† article is rather tricky. On one hand, the disconcerting online revelation with Mimi protesting against China serves as solid evidence not to hire her. If members of the management team based in China discover the pictures and information about Mimi’s protests, they may decline to continue to conduct business with Hathaway Jones. It will also ruin the company’s reputation in the eyes of potential future customers. In addition to the searched Google results, Mimi’s recommendations also contained a few negative traits including brash and strongly opinionated.These aspects may not allow her to get along with other workers and colleagues. Her liberal behavior including her wink at Fred is not quite suitable for China’s more conservative culture. On the other hand, it is possible that Virginia misunderstood the information she found online. Fred should consult Mimi directly to fully understand the situ ation about what really happened. It is extremely easy for someone to falsify information and manipulate digital media. With digital cameras being so prominent today, it is inevitable that personal pictures and information would end up online for everyone to Google and find out.Additionally, Mimi’s background includes a strong education and solid experience. Her Berkeley and Stanford degrees and past job positions will allow her to perform the job at a higher level of expertise than many other potential job applicants. As discussed in class, employers should hire based on ability to perform and not on hard data and statistics. From these standpoints, the benefits to hiring outweigh the costs. For these reasons, I support the decision to hire Mimi. I feel that she would make an excellent addition and make a great deal of contributions to Hathaway Jones.

Time Value

TIME VALUE OF MONEY 1. If you were scheduled to receive Rs 100,000 five years hence, but you wish to sell your contract note for its present value, which type of compounding would you rather have the purchaser of your contract note to use to find the purchase price, 8 percent compounded: (a) (b) (c) (d) (e) Continuously Quarterly Semi-annually Annually None of the above 2. According to the rule of 69, the doubling period is equal to (a) (b) (c) (d) (e) 0. 25 + (69/ Interest rate) 0. 35 + (69/ Interest rate) 0. 69 + (0. 35/ Interest rate) 0. 69 + (0. 25 / Interest rate) None of the above 3. For a depositor, when the frequency of compounding is increased (a) (b) (c) (d) (e) Additional gains increase Additional gains dwindle Additional gains are unaffected There are no additional gains None of the above 4. Present value interest factor of a perpetuity represents (a) (b) (c) (d) (e) Interest rate in percentage terms Reciprocal of interest rate in percentage terms Reciprocal of interest rate in decimal terms Interest rate in decimal terms None of the above 5. The present value of a perpetuity of one rupee when the interest rate is r percent is: (a) (b) (c) (d) (e) 1/r 1/ r2 1/r0. 2 r2 None of the above 1 6. The present value of an annuity due is equal to the present value of a regular annuity multiplied by : (a) (b) (c) (d) (e) r (1 + r) 1/r r(1 + r) None of the above 7. Recurring deposit in a bank is a typical example of: (a) (b) (c) (d) (e) Deferred annuity Annuity due Regular annuity Compound annuity None of the above 8. Deposits in a sinking fund is an example of: (a) ( b) (c) (d) (e) Deferred annuity Annuity due Regular annuity Either a or c None of the above 9. In a loan amortisation schedule, as the number of years increases: (a) (b) c) (d) (e) The interest amount increases The principal repayment amount increases The annual installment amount decreases Both a and c None of the above KEY 1 (d) 2 (b) 3 (b) 4 (c) 5 (a) 6 (b) 7 (b) 8 (d) 9 (a) 2 VALUATION OF STOCKS AND BONDS 1. The annual interest on a bond in relation to its prevailing market price is called its: (a) (b) (c) (d) (e) Coupon rate Promised yield Current yield Yield to maturity None of the above 2. Internal rate of return on a bond investment is its (a) (b) (c) (d) (e) Current yield Yield to maturity Holding period return Realised yield None of the above . The constant-growth dividend discount model will not produce a finite value if the dividend growth rate is: (a) (b) (c) (d) (e) Above its historical average Below its historical average Above the market capitalisation rate Below the market capitalisation rate None of the above 4. For any given stock, which of the following must be true? (a) (b) (c) (d) (e) Market value ? book value ? par value Book value ? market value ? par value Par value ? market value ? book value Par value = book value ? market value None of the above must be true 5. Limited growth prospects are indicated by (a) (b) (c) (d) (e) High dividend High P/E ratio Low dividend High dividend and low P/E ratio None of the above 3 6. Riskier stocks have (a) (b) (c) (d) (e) Higher P/E multiple Lower P/E multiple Higher variance (b) and (c) None of the above 7. Which of the following is not true? (a) (b) (c) (d) (e) Earnings-price ratio is equal to r when PVGO is zero Earnings-price ratio is less than r when PVGO is positive Earnings-price ratio is less than r when PVGO is negative Earnings-price ratio is more than r when PVGO is negative None of the above 8. An increase in the market value of a company indicates: (a) (b) (c) (d) (e) Increase in profitability Increase in revenues Increase in future prospects All the above None of the above 9. Intrinsic value of a security is its: (a) (b) (c) (d) (e) DCF value Book value Real value Market capitalization value None of the above 10. Which one of the following is not a major driver of growth? (a) (b) (c) (d) (e) Sales growth ratio Ploughback ratio Return on equity All the above None of the above 11. In the case of stocks with lower P/E multiples: (a) Liquidity is low (b) Required return is high (c) Risk is high 4 d) All the above (e) None of the above 12. All trades on NSE are guaranteed by: (a) (b) (c) (d) (e) SEBI NSDL NSCC CDSL None of the above 13. In respect of the sample shares, sensex reflects the movement of: (a) (b) (c) (d) (e) Average total market value of the floating stocks Average market value of the floating stocks times a fixed multiple Average capitalisation of the issued and paid up stocks Average aggregate market value of the subscribed stocks None of the above Formatted: Font color: Auto Formatted: Font color: Auto Formatted: Font color: Auto 14. The book value of a firm? s equity is nothing but the book value of its assets minus the book value of its liabilities: a. True b. False 15. Market value of a firm has to be at least equal to its: (a) (b) (c) (d) (e) Book value Cash and bank balance Net asset value Lowest of the above None of the above 16. Intrinsic value of a security is its: (a) (b) (c) (d) (e) Market value Book value Economic value Resale value None of the above 5 KEY 1 (c) 12 (c) 2 (b) 13 (a) 3 (c) 14(a) 4 (e) 15(e) 5 (d) 16(c) 6 (d) 7 (c) 8 (e ) 9 (a) 10 (a) 11 (d) 6 RISK AND RETURN 1. Variance will always be (a) (b) (c) (d) (e) Positive Negative Variable Very high None of the above 2. A normal distribution is completely characterised by (a) (b) (c) (d) (e) Expected return and standard deviation Required return and variance Expected return and range Standard return and expected variance None of the above 3. If a variable is normally distributed what percentage of the values fall within a band of one standard deviation on either side of the arithmetic mean. (a) (b) (c) (d) (e) 95. 4 percent 68. 3 percent 99. 7 percent 57. 5 percent None of the above 4. If a variable is normally distributed what percentage of values will fall within a band of three standard deviations on either side of the arithmetic mean? (a) (b) (c) (d) (e) 95. 4 percent 68. 3 percent 99. 7 percent 57. 5 percent None of the above 5. Which of the following is true? (a) (b) (c) (d) The geometric mean is always less than the arithmetic mean The geometric mean is always greater than the arithmetic mean The geometric mean and the arithmetic mean are always the same The geometric mean is always less than the arithmetic mean, except when all the return values being considered are equal (e) None of the above 7 . When the probability distribution of rate of return of a security is defined, the possible outcomes: (a) (b) (c) (d) (e) Should be mutually exclusive Should be collectively exhaustive Should not add to more than 1 All the above None of the above 7. Preparing the probability distribution of rate of return of a security is: (a) An objective exercise based on the pre vailing market conditions (b) An objective exercise based on the past history of the securities performance (c) An objective exercise based on the future prospects of the security. d) A subjective exercise (e) None of the above 8. While analysing the returns of a security based on a continuous probability distribution, probabilities are assigned to: (a) (b) (c) (d) (e) Individual points on the curve Intervals between two points on the curve The gradient between any two referenced points on the curve Either b or c None of the above 9. Diversification eliminates risk if returns are: (a) (b) (c) (d) (e) Not perfectly positively correlated Perfectly positively correlated Perfectly negatively correlated All the above None of the above 10. If the return on a security is negatively correlated with the market return, its beta is: (a) (b) (c) (d) (e) Less than zero Less than one but more than zero More than one Independent of the market return None of the above 8 11. To judge creditworthiness of firms, leading international rating firms use debt ratios expressed in: (a) (b) (c) (d) (e) Market values Book values Real values Discounted values None of the above 12. A defensive stock is characterised by: (a) (b) (c) (d) (e) Negative beta Positive beta less than one Positive beta more than one Beta equal to one None of the above 3. When you want to know the central tendency of a series of returns, the arithmetic mean is the appropriate measure: a. True b. False 14. For a given series of returns geometric mean is always greater than the Arithmetic mean: b. True b. False 15. Business risk of a firm : (a) (b) (c) (d) (e) Is the risk of the firm without financial leverage Depends on cyclicality of revenues Depends on operating lev erage All the above None of the above 16. Debt rating firms such as Standard & Poor? and Moody? s use debt ratios expressed in market values to judge credit worthiness: a. True b. False KEY 1 (a) 12 (b) 2 (a) 13(a) 3 (b) 14(b) 4 (c) 15(d) 5 (d) 16(b) 9 6 (d) 7 (d) 8 (b) 9 (c) 10 (a) 11 (b) TECHNIQUES OF CAPITAL BUDGETING 1. As discount rate increases, NPV of a simple project (a) (b) (c) (d) (e) Increases at a decreasing rate Decreases at an increasing rate Decreases at a decreasing rate Decreases at a steady rate None of the above 2. When time-varying discount rates are involved the suitable investment criterion is (a) (b) (c) (d) (e) NPV IRR MIRR Discounted Pay Back Period None of the above 3. If initial investment is Rs. 10 million and NBCR is 0. 2, the NPV is (a) (b) (c) (d) (e) Rs. 50 million Rs. 2 million Rs. 8 million Rs. 5 million None of the above 4. IRR is unreliable for ranking projects when (a) (b) (c) (d) (e) Life of the projects are long Projects have different patterns of cash flow Projects have decreasing cash flows Both a and c None of the above . If you do not know the discount rate for a project, the right investment criterion to be used will be (a) (b) (c) (d) (e) IRR MIRR NPV BCR None of the above 10 6. The IRR of a capital investment (a) Changes when the cost of capital changes (b) Is equal to annual cash flows divided by the project? s cost when the cash flows are an annuity (c) Is similar to the yield to maturity on a bond (d) Must exceed the cost of capital in order for the firm to accept the investment (e) Both b and d are true (f) Both c and d are true 7. The modified internal rate of return (MIRR) is superior to the regular IRR because: (a) MIRR modifies IRR to reflect project risk (b) While IRR may be negative, MIRR can never be negative (c) MIRR assumes that project cash flows are reinvested at the cost of capital whereas the regular IRR assumes that the project cash flows are reinvested at the project? s own IRR (d) The problem of multiple rates does not exist with MIRR (e) c and d (f) b, c, and d 8. When a firm takes on a new project with a positive NPV, it will necessarily increase the value of the firm. . True b. False 9. The NPV rule assumes that the intermediate cash flows of a project are reinvested at a rate equal to: (a) (b) (c) (d) (e) The cost of capital The cost of equity The internal rate of return The current yield None of the above 10. The modified internal rate of return (MIRR) is superior to the regular IRR because: (a) (b) (c) (d) (e) It assumes that project cash flows are reinvested at the cost of capital Reinves tment cost of capital is more realistic It is not a subjective measure both a and b None of the above 1 11. Which of the following is true: (a) IRR rule assumes that intermediate cash flows are reinvested at the cost of capital (b) The IRR rule cannot distinguish between lending and borrowing (c) IRR is difficult to apply when short-term interest rates from long-term interest rates (d) IRR cannot be used when the cost of capital is not known (e) None of the above KEY 1 (c) 2 (a) 3 (b) 4 (b) 5 (a) 6 (f) 7 (e) 8 (b) 9 (a) 10 (d) 11 (b) 12 PROJECT CASH FLOWS 1. Which one of the following may not be generally relevant in establishing the time horizon for cash flow analysis? (a) (b) (c) (d) (e) Investment planning horizon of the firm Physical life of the plant Technological life of the plant Product market life of the plant None of the above 2. While defining the cash flows on the investment side, interest cost is not considered because: (a) (b) (c) (d) (e) It is a proxy to the rate of return Historical interest rates have no relevance It is included in the cost of capital Both b and c None of the above . All incidental effects of a project on the rest of the firm should be considered while estimating project cash flows because: (a) (b) (c) (d) (e) It may have a complementary relationship with the existing activities It may have a competitive relationship with the existing activities It may have a supplementary relationship with the existing activities Both a and b None of the above 4. The cost created for the rest of the firm as a consequence of undertaking a project is: (a) (b) (c) (d) (e) The company weighted average cost of capital The marginal cost of capital The project weighted average cost of capital An opportunity cost None of the above 5. For purposes of investment analysis, what matters is: (a) (b) (c) (d) Overhead costs allocated to the project Incremental overhead costs attributable to the project Weighted average overhead costs attributable to the project Projected average overhead costs attributable to the project 13 (e) None of the above 6. Which of the following may not generally result in underestimation of project cash flows? (a) (b) (c) (d) (e) Ignoring intangible benefits Under estimation of salvage values Overlooking the value of future options Under estimation of project cost of capital None of the above 7. Product cannibalisation involves (a) (b) (c) (d) (e) Erosion of sales of an existing product due to own new product Erosion of sales of an existing product due to an own older product Erosion of sales due to a competitor? s existing product Erosion of sales due to a competitor? new product None of the above 8. Which one of the following is a sunk cost (f) (g) (h) (i) (j) R & D expenditure not leading to a product Preliminary survey expenses before setting up the plant Sponsorship expenses of Indian cricket team Contribution to Prime Ministers Relief Fund None of the above 9. In the financing side of a project, explicit funds include (k) Trade creditors (l) Bank overdraft (m) Provision for income tax (n) Provis ion for proposed dividend (o) None of the above KEY 1 (b) 2 (c) 3 (d) 4 (d) 5 (b) 6 (d) 7 (a) 8 (b) 9 (b) 14 RISK ANALYSIS IN CAPITAL BUDGETING 1. While evaluating the risk of a project, an undiversified shareholder is more concerned about: (a) (b) (c) (d) (e) Stand-alone risk Corporate risk Market risk All the above None of the above 2. In which of the following, values of a set of variables are varied concurrently by specified values? (a) (b) (c) (d) (e) Scenario analysis Sensitivity analysis Simulation analysis Decision tree analysis None of the above 3. In which of the following, correlations between variables are to be handled properly? (a) (b) (c) (d) (e) Scenario analysis Sensitivity analysis Simulation analysis Decision tree analysis None of the above 4. A lower price: (a) (b) (c) (d) (e) Increases potential demand Decreases the break-even level Increases the break-even level Both a and c None of the above 5. Which one of the following is the best way of incorporating risk in the decision process? (a) (b) (c) (d) Certainty equivalent Pay back period requirement Risk-adjusted discount rate Judgmental evaluation 15 (e) None of the above 6. Financial break even occurs at the point of time when the (a) (b) (c) (d) (e) Firm starts making operating profits Accumulated losses are wiped off Present value of investment becomes zero Cash flows become steady None of the above . Randomly selected values are used in (a) (b) (c) (d) (e) Sensitivity analysis Break even analysis Decision tree analysis Simulation analysis None of the above rate 8. The NPV of a simple project decreases at a constant rate as the discount increases. a. True b. False 9. When the cash flows of a project are perfectly correlated, the standard deviation of the NPV is: n (a) ? t=1 A _____ – I ( 1+ i)t ? t _____ – I ( 1+ i)t ? t _____ ( 1+ i)t 1/2 n (b) ? t=1 n (c) ? t=1 n (d) ? t=1 ? _____ (1+ i)2t 2 t (e) None of the above 16 10. An investor for whom the certainty index is less than the expected value, is (p) (q) (r) (s) (t) Risk loving Risk averse Risk neutral Risk allergic None of the above KEY 1 (b) 2 (a) 3 (c) 4 (d) 5 (e) 6 (c) 7 (d) 8 (b) 9 (c) 10 (b) 17 THE COST OF CAPITAL 1. Which of the following is not reflected in the company cost of capital? (a) (b) (c) (d) (e) Rate of return expected on a proposed investment Business risk of the existing assets Risk of the existing capital structure All the above None of the above 2. A firm has an existing bank loan contracted at 10 percent a year back. The bank has since reduced the lending rates and the company, if it wants, can raise a fresh loan from the bank at 9 percent. While determining the WACC, the cost of bank loan for the company would be: (a) (b) (c) (d) (e) 10 percent 9 percent Weighted average of the old and new bank interest rates Either b or c None of the above 3. The correct cost of debt to be used in calculation of the average cost of capital is the: (a) (b) (c) (d) (e) Marginal cost of debt Yield to maturity Average cost of debt Either a or b None of the above 4. Cost of retained earning is (a) (b) (c) (d) (e) Nil Nearly equal to cost of depreciation Nearly equal to cost of equity Nearly equal to average cost of debt None of the above 5. In determining cost of capital using „Bond yield plus risk premium approach? the risk premium is set at (a) 2 % of the bond yield (b) 4 % of the bond yield (c) 1% of the bond yield if the latter is more than 12 % 18 (d) Both a and c (e) None of the above 6. The chief merit of using book value proportions to calculate WACC is that (a) (b) (c) (d) (e) It is unbiased It is simple It is more realistic It is based on audited figures None of the above . For a given capital structure, the levels of total new financing at which the cost of the new components would change is called (a) (b) (c) (d) (e) Turning points Breaking points Inversion points Relevant points None of the above 8. When the marginal cost of capital is the same for two projects and there are no funds constraints, you will select (a) (b) (c) (d ) (e) Project with the shorter payback period Project with the higher IRR Both the projects if NPVs are positive Preferably project with higher IRR and higher NPV None of the above 9. Which of the following conditions should be satisfied for using WACC for evaluating new investments? (a) The risk of new investments is the same as the average risk of existing investments (b) The cost of equity is greater than the cost of debt (c) The capital structure of the firm will not be affected by the new investments (d) a and c (e) None of the above 19 10. The risk-adjusted discount rate method assumes that the risk increases with time at: (a) (b) (c) (d) (e) Increasing rate A constant rate Decreasing rate A random rate None of the above KEY 1 (a) 2 (b) 3 (a) 4 (c) 5 (e) 6 (b) 7 (b) 8 (c) 9 (d) 10 (b) 20 CAPITAL BUDGETING: EXTENSIONS 1. General Electric? s Stoplight Matrix is used for: (a) (b) (c) (d) (e) Resource allocation Identification of worthwhile projects Abandoning worthless projects Scaling up corporate efficiency None of the above 2. Which of the following conditions must be satisfied by a capital budget to be meaningful and viable? (a) (b) (c) (d) (e) It must be compatible with the resources of the firm It must be controllable It must be endorsed by executive management All the above None of the above . A company? s debt equity ratio is 1:1. It proposes to undertake an aerodrome project with proposed debt equity ratio of 3:1. The discount rate that should be applied to the project should be: (a) (b) (c) (d) (e) Weighted average cost of debt Marginal cost of debt Incremental discount rate Adjusted discount rate None of the above 4. Which of the following are options embedded in real life projects? (a) (b) ( c) (d) (e) Incremental option Flexibility option Abandment option All the above None of the above 5. Which of the following may not result in positive NPV projects? a) (b) (c) (d) (e) Marketing reach Government policy Customer affluence Product differentiation None of the above 21 6. Which of the following is a necessary condition to ensure success in business strategies? (a) (b) (c) (d) (e) Intuition Vision of the leader Rigorous analysis Sponsorship None of the above 7. In determining the adjusted present value, tax shields on financing effects are discounted at (a) (b) (c) (d) (e) Opportunity cost of equity Marginal cost of debt Weighted average cost of debt Average of a and b None of the above KEY 1 (a) 2 (d) 3 (d) 4 (d) 5 (c) 6 (c) 7 (b) 22 MARKET EFFICIENCY AND FINANCING DECISIONS 1. There will be no concern about transfer of wealth from existing to new shareholders if new securities are issued (a) (b) (c) (d) (e) above market price at market price at par by book building method None of the above 2. Market efficiency implies that: (a) (b) (c) (d) (e) Errors in the market prices are biased Market price equals intrinsic value Price deviations cannot be predicted It is not possible to identify over and under-valued stocks None of the above 3. Market efficiency exists because; (a) (b) (c) (d) (e) Portfolio managers are doing their job well There is keen competition among market participants New information cannot be predicted in advance All the above None of the above 4. Returns over horizons of a few weeks or months would be positively correlated because of the action of: (a) (b) (c) (d) (e) Noise traders Arbitrageurs Speculators Both a and b None of the above 5. Which of the following is a calendar anomaly? (a) (b) (c) (d) (e) Week end effect January effect Budget effect Both a and b None of the above 23 6. Serial correlation tests, run tests and filter rules tests have been commonly employed to verify: (a) (b) (c) (d) (e) Strong form of efficient market hypothesis Semi- strong form of efficient market hypothesis Weak form of efficient market hypothesis Both a and b None of the above 7. In an efficient market, the market price of a security is: (a) (b) (c) (d) (e) An unbiased predictor of its intrinsic value An unbiased estimate of its intrinsic value A logical mean of the market participants? expectations The expected value of a normal distribution None of the above 8. Study of market efficiency teaches corporates that: (a) Manipulation of earnings does not pay (b) It is advantageous to issue debt rather than equity (c) The objective of corporate finance should be to maximise the market value of the firm in due course (d) Equity issues should not be deferred because the stock price was significantly low in recent periods (e) None of the above 9. In an efficient market, an unbiased estimate of the intrinsic value of a security can be obtained from its: (a) (b) (c) (d) (e) Market value Book value Cash value Capital value None of the above 0. According to Efficient Market Theory, price changes cannot be forecast since: (a) Inflation cannot be predicted with any acceptable degree of accuracy (b) New information cannot be predicted in advance. (c) Insiders and other vested interest groups will not allow the market to become efficient (d) All the above (e) None of the above 24 11. Though elegant in theory, bulk of the results of empirical studies have fa iled to support Efficient Market Hypothesis: a. True b. False 12. A puzzling calendar anomaly is : (a) (b) (c) (d) (e) The Mid Summer Effect The Easter Effect The January Effect The March Effect None of the above 13. Noise trade is always supported by: (a) (b) (c) (d) (e) Efficient Market Hypothesis Rational expectations theory Technical analysis Fundamental analysis None of the above KEY 1(b) 2 (e) 3 (d) 4 (d) 5 (d) 6 (c) 7 (b) 8 (a) 9(a) 10(b) 11(b) 12(c) 13(e) 25 SOURCES OF LONG-TERM FINANCE 1. As per law the issue price of a share cannot be: (a) Less than the par value (b) Less than the issue price of any preceding public offer. c) More than twenty times the average P/E multiple for the past years. (d) More than 20 times the book value (e) None of the above 2. When a company? s net profit doubles, that has to result in: (a) (b) (c) (d) (e) Increase in market value Increase in book value Decrease in cost of equity Both a and b None of the above three 3. Which one of the following is known not to have any effect on the market price of stocks? (a) (b) (c) (d) (e) Current earnings Growth prospects Risk Company size None of the above 4. Which one of the following is generally viewed with skepticism by the stock market? a) (b) (c) (d) (e) Debenture issue Equity issue Soliciting public deposits Not declaring large dividends None of the above 5. If you are the CEO of a company, which one of the following will you decide to skip in a lean year? (a) (b) (c) (d) Declaring preference dividend Declaring equity dividend Declaring bonus issue Putting on hold new projects 26 (e) None of the above 6. The par value of an equity share is the value: (a) (b) (c) (d) (e) As stated in the memorandum The price at which it is issued The price at which it will be repurchased Both a and c None of the above . The income on which the equity holders have a residual claim is: (a) (b) (c) (d) (e) Profit after tax Profit after tax plus equity dividend Profit after tax less equity dividend Profit after tax less preferred dividend None of the above 8. When the financial performance of a company is impressive, the board of directors, if they so wish, can: (a) (b) (c) (d) (e) Refuse to pay equity dividend Cannot refuse to pay equity dividend without shareholders? approval Refuse to pay preference dividend Both b and c None of the above 9. Issue expenses are the least in the case of: (a) (b) (c) (d) (e) Public issue of equity Public issue of debentures Rights issue Private placement None of the above 10. According to CAPM, going in for debt financing: (a) (b) (c) (d) (e) Decreases the cost of equity Increases the cost of equity Does not affect the cost of equity Either a or c None of the above 27 KEY 1 (a) 2 (b) 3 (e) 4 (b) 5 (d) 6 (a) 7 (d) 8 (a) 9 (c) 10 (b) 28 RAISING LONG TERM FINANCE 1. IPO refers to the first issue of: (a) (b) (c) (d) (e) Equity Debentures Preference shares Either a or b None of the above . The first option to acquire the equity investment held by a VC is typically give to: (a) (b) (c) (d) (e) The public The promoters of the VC fund The associates of the VC fund The promoters of the assisted firm None of the above 3. A rights issue generally tends to result in: (a) (b) (c) (d) (e) Increase in return on equity Decrease in earnings per share Decrease in return on investments Increase in earnings pe r share None of the above 4. In which of the following the identity of investors is generally known at the time of approval of shareholder approval itself? a) (b) (c) (d) (e) Private placement Preferential allotment Convertible debentures GDR None of the above 5. Lead manager of a public issue can be likened to (a) (b) (c) (d) (e) master of ceremonies best man in a wedding conductor of an opera producer of a movie None of the above 29 6. Which one of the following is not a potential advantage that prods a company to go public? (a) (b) (c) (d) (e) Accountability Respectability Investor recognition Liquidity None of the above 7. Composite application form sent along with letter of offer of a rights issue includes (a) (b) (c) (d) (e) a form showing the number of rights shares the shareholder is entitled to a form through which rights can be renounced in favour of someone a form for rejecting the offer both a and b None of the above 8. Wealth of an existing shareholder per se is not affected by the right offering if he (a) (b) (c) (d) (e) sells the rights does not participate in the right exercises the rights partially both a and b None of the above 9. Before a company makes a preferential allotment (a) (b) (c) (d) (e) it must pass a special resolution obtain special approval under section 81(1A) from government both a and b either a or b None of the above 10. Dilution of proportional ownership can be avoided by making (a) (b) (c) (d) (e) private placement debenture issue a rights issue either b or c None of the above 11. Book building is used to help in better (a) Price discovery (b) Retail participation 30 (c) Institutional participation (d) Investor communication (e) None of the above 12. In any IPO, there is infusion of capital in the company: a. True b. False 13. Who among the following is not an eligible QIB? (a) (b) (c) (d) (e) State Industrial Development Corporations Mutual Funds Scheduled commercial banks Foreign institutional investors registered with SEBI None of the above 14. If a company? s project has not been appraised by financial institutions or scheduled commercial banks, it is not eligible for an IPO: a. True b. False 15. Retail investors cannot change their bids during the bidding process in: (a) (b) (c) (d) (e) French auction Book building Commodity auction All the above None of the above 16. In a preferential allotment of shares, the lock-in period is applicable to : (a) (b) (c) (d) (e) 17. QIPs : (a) (b) (c) (d) (e) Fetch a good price Entail minimal cost Can be completed very quickly All the above None of the above The appraising bank FII Lead Manager of the investment bank. The promoters None of the above 31 18. To get an anchor investor you should look among: (a) (b) (c) (d) (e) QIBs QIPs FIIs HNIs None of the above 19. The focus area for an Investment Bank is : (a) (b) (c) (d) (e) Investment Commercial banking Merchant banking All the above None of the above 0. In India, a trader who performs market-making function for a security is not permitted to engage in proprietary trading function in the same security: a. True b. False KEY 1 (a) 12(b) 2 (d) 13(e) 3 (b) 14(a) 4 (b) 15(a) 5 (c) 16(d) 6 (a) 17(d) 7 (d) 18(a) 8 (a) 19(c) 9 (d) 20(b) 10 (d) 11 (a) 32 CAPITAL STRUCTURE AND FIRM VALUE 1. According to net operating income approach increase in leverage will affect (a) (b) (c) (d) (e) cost of debt cost of equity overall capitalisation rate both a and b None of the above . According to net income approach, as leverage decreases (a) (b) (c) (d) (e) average cost of capital decreases average cost of capital increases cost of debt increases cost of equity decreases None of the above 3. According to the Merton Miller argument, the original MM proposition which says that financial leverage does not matter in a tax-free world (a) (b) (c) (d) (e) is valid in a world where both corporate and personal taxes exist is not valid in a world where both corporate and personal taxes exist is valid n a world where the corporates are exempt from taxes is valid in a world where corporate taxes exist but no personal taxes exist None of the above 4. Which one of the following statements is true? (a) (b) (c) (d) (e) Net operating income approach and MM? s first proposition are identical Net income approach and MM? s second proposition are identical Net operating income a pproach and traditional approach are identical Net income approach and MM? s first proposition are identical None of the above 5. One of the assumptions underlying the MM proposition is that firms can be grouped into equivalent risk classes based on their (a) (b) (c) (d) (e) systematic risk financial risk business risk both a and b None of the above 33 6. According to the signaling theory of capital structure, the pecking order of financing is as follows: (a) (b) (c) (d) (e) External equity finance, debt finance and internal finance Internal finance, external equity finance and debt finance Debt finance, external equity finance and internal finance Retained earnings, debt finance and external equity finance None of the above . According to Myers, the pecking order of financing can be fully explained if there is (a) (b) (c) (d) (e) asymmetric information and divergent expectations homogeneous expectations and symmetric information rational expectations reasonable expectations None of the above 8. According to the net operating income approach, the overall capitalisation rate and the cost of debt remain constant for all degrees of leverage: a. True b. False 9. According to the rational expectations hypothesis, what matters in economics is the congruence between what actually happens and what was supposed to happen. . True b. False 10. According to the net income approach, the average cost of capital remains constant for all levels of financial leverage. a. True b. False 11. The relationship between the return on equity (ROE), return on investment (ROI), cost of debt (r), debt-equity ratio (D/E), and tax rate (t) is as follow (a) (b) (c) (d) (e) ROE = [ROI +(ROI –r) D/E ] (1-t) ROE = [ROI – (ROI –r) D/E ] (1-t) ROE = [ROI +(ROI + r) D/E ] (1-t) ROE = [ROI +( r- ROI ) D/E ] (1-t) None of the above 34 KEY 1 (b) 2 (b) 3 (a) 4 (a) 5 (c) 6 (d) 7 (a) 8 (a) 9 (b) 10 (b) 11 (a) 35 CAPITAL STRUCTURE DECISIONS 1. Financial risk is minimum in (a) (b) (c) (d) (e) debt issue IPO rights equity issue both b and c None of the above 2. Financial slack is more valuable to a firm with (a) (b) (c) (d) (e) poor growth opportunities more intangible assets high liquidity less intangible assets None of the above 3. A powerful defence against bankruptcy is (a) (b) (c) (d) (e) flexibility higher growth expansion modernisation None of the above 4. A company should avoid financial hype in an efficient market because of the dominant role of (a) (b) (c) (d) (e) SEBI lead steers aggressive investors conservative investors None of the above 5. Which of the following is an indirect cost of bankruptcy? (a) Due to myopia, managers may sacrifice actions to build value in the long run (b) Legal and administrative costs are quite high (c) Arguments between shareholders and creditors delay the liquidation of assets (d) If assets are sold under distressed conditions, they may fetch a price significantly less than their economic value 36 e) None of the above 6. Weakened commitment of employees, customers, suppliers, distributors, and other stakeholders is a direct cost of financial distress a. True b. False 7. Creditors face the problem of moral hazard when they lend to a firm that has a large outstanding debt in relation to the value of its assets. a. True b. False 8. The tradeoff theory explains satisfactorily why profitable firms like Hi ndustan Lever depend so little on debt. a. True b. False 9. According to the rational expectations hypothesis what matters in economics is what was rationally expected to happen: a. True b. False KEY 1 (d) 2 (b) 3 (a) 4 (b) 5 (a) 6 (b) 7 (b) 8 (b) 9 (b) 37 DIVIDEND POLICY AND FIRM VALUE 1. Walter model assumes that for financing future investments, a firm will rely only on (a) (b) (c) (d) (e) debentures term loans retained earnings external equity None of the above 2. Value of a firm according to MM depends solely on its (a) (b) (c) (d) (e) equity borrowing capacity earning power dividend payout ratio None of the above 3. As per Gordon model when the rate of return is less than the discount rate, as the dividend payout ratio increases, price per share (a) (b) (c) (d) (e) increases decreases remains unchanged at first increases and then decreases None of the above 4. Radicalists support (a) (b) (c) (d) (e) low dividend payout high dividend payout steady dividend payout stock splits None of the above 5. According to the Walter model, the price of a share is equal to : D ——k (E-D) r/k ———-k (a) + 38 (c) D ——-k _ (E-D) r/k ————-k (E +D) r/k —————-k (c) D ———k + (d) D ——-k + E-D)r/k ————–k (e) None of the above 6. According to the traditional position on the impact of dividend policy on the firm value, the firm value is positively influenced by: (a) (b) (c) (d) (e) A liberal payout policy A conservative payout policy Slow but s teady increase in dividends Higher retention ratio None of the above 7. MM? s view on dividend policy and firm value is: (a) (b) (c) (d) (e) Traditional Radical Academic Subjective None of the above KEY 1 (c) 2 (c) 3 (a) 4 (a) 5 (a) 6 (a) 7 (c) 39 DIVIDEND DECISION 1. Which one of the following is not a plausible reason for paying dividends? a) (b) (c) (d) (e) Investor preference for dividends Information signaling Temporary excess cash Clientele effect None of the above 2. According to the Lintner? s model of corporate dividend behaviour, the current dividend can be explained (a) (b) (c) (d) (e) as a weighted average of past earnings in terms of current earnings and previous year dividend solely in terms of previous year dividend both a and b None of the above 3. Dividend declaration is usually made in (a) (b) (c) (d) (e) board meeting annual general meeting special shareholder meeting b or c None of the above . Bonus shares can be issued out of (a) (b) (c) (d) (e) revaluation rese rve share premium collected in cash excess cash balance accounts receivable None of the above 5. In a stock-split (a) (b) (c) (d) (e) earnings are capitalised EPS remains unchanged book value declines both a and c None of the above 40 6. Which of the following can be a motivator for share buy backs? (a) (b) (c) (d) (e) Price stability Idle cash Tax advantage All the above None of the above 7. The post-buyback debt-equity ratio of company should not exceed : (a) (b) (c) (d) (e) 2 . : 1 1. 33 : 1 1. 0 : 1 1. 0 : 2 None of the above 8. According to Graham and Dodd the weight attached by the market to dividends is equal to: (a) (b) (c) (d) (e) five time the weight attached to retained earnings four times the weight attached to retained earnings three times the weight attached to retained earnings half the weight attached to profit after tax None of the above 9. According to the Lintner model (a) (b) (c) (d) (e) Dt – Dt-1 = c ( r EPSt – Dt-1 ) Dt – Dt-1 = c ( Dt†“1 – r EPSt ) Dt = Dt-1 + c ( EPSt – r Dt-1) Dt = r Dt-1 None of the above 10. According to John Lintner, managers are concerned more about the absolute level of dividend than the change in dividend. a. True b. False 11. Junk bonds are bonds that have a credit rating of: (a) (b) (c) (d) (e) BBB or lower BB or lower B or lower C or lower None of the above 41 12. In which stage of the dividend life cycle, informational asymmetry is moderate? (a) (b) (c) (d) (e) Decline Rapid growth Infancy Maturity None of the above 13. A share buyback programme effectively: (a) (b) (c) (d) (e) Decreases the EPS Decreases the P/E ratio Increases the share price All the above None of the above 4. As per SEBI guidelines, buyback of shares can be done through the Dutch auction route: b. True b. False KEY 1 (c) 12(b) 2 (d) 13(b) 3 (a) 14(a) 4 (b) 5 (c) 6 (d) 7 (a) 8 (b) 9 (a) 10 (b) 11 (b) 42 WORKING CAPITAL POLICY 1. Which portion of total capital generates most of the profits? (a) (b) (c) (d) (e) Fixed assets Investments Working capital Paid-up capital None of the above 2. Which on e of the following is not part of working capital? (a) (b) (c) (d) (e) Inventory Receivables Instalments of term loans due within the next twelve months Investments None of the above . The life span of current assets does not depend on: (a) (b) (c) (d) (e) Sales Production Maintenance Synchronisation among them None of the above 4. The working capital needs of a firm are not influenced by: (a) (b) (c) (d) (e) Nature of business Seasonality of operations Production policy Market conditions None of the above 5. A firm that manages with a small amount of inventory is said to be following a: (a) (b) (c) (d) (e) Aggressive policy Conservative policy Defensive policy Survival policy None of the above 43 6. To be consistent with the „The Matching Principle? fluctuating current assets must be supported by: (a) (b) (c) (d) (e) Equity Debentures Short-term bank borrowings Long- term bank borrowings None of the above 7. A negative cash cycle for a company necessarily implies: (a) (b) (c) (d) (e) Poor management of credit sales Poor management of receivables Poor management of trade creditors Poor management of profitability None of the above 8. Which one of the following typically needs the least working capital? (a) (b) (c) (d) (e) A tea plantation A hotel A construction company A departmental store None of the above . Which one of the following will decrease the length of the cash cycle? (a) (b) (c) (d) (e) Increase in inventory period Increase in accounts receivable period Increase in accounts payable period Decrease in accounts payable period None of the above 10. If you subtract net working capital from gross working capital, you will get: (a) (b) (c) (d) (e) Current assets Current liabilities Fixed assets Net profit None of the above KEY 1 (e) 2 (d) 3 (c) 4 (e) 5 (a) 6 (c) 7 (e) 8 (b) 9 (c) 10 (b) 44 CASH AND LIQUIDITY MANAGEMENT 1. The principal tool of cash management is: (a) (b) (c) (d) (e) Short-term cash forecasting Maximising daily collections Maximising the payment slack Obtention of fine rates None of the above 2. In cash forecasting, which one of the following analysis is generally used? (a) (b) (c) (d) (e) Sensitivity analysis Scenario analysis Simulation analysis Decision tree analysis None of the above 3. The method that is generally used for long-term cash forecasting is: (a) (b) (c) (d) (e) Adjusted net income method Adjusted receipt and payment method Average income and expenditure method Cash deficit gap method None of the above . Which of the following, according to Keynes, is not a motive for holding cash (a) (b) (c) (d) (e) Speculative motive Psychological motive Precautionary motive Transaction motive None of the above 5. Float is the difference between: (a) (b) (c) (d) (e) Available balance and the ledger balance Available balance and the amount yet to be collected Total available balance an d the bank balance Total available balance and the balance in hand None of the above 45 6. Net float is: (a) (b) (c) (d) The difference between disbursement float and collection float The sum of disbursement float and collection float The difference of the available balance and balance on hand Either a or c 7. Which of the following is the most important criterion for evaluating various investment instruments? (a) (b) (c) (d) (e) Safety Yield Liquidity All the above None of the above 8. The most popular mutual fund schemes for investing short- term surpluses are: (a) (b) (c) (d) (e) Equity schemes Balanced schemes Debt schemes Hybrid schemes None of the above 9. Commercial paper is a: (a) (b) (c) (d) (e) Secured bill of exchange Unsecured bill of exchange Secured promissory note Unsecured promissory note None of the above 10. Which one of the following is secured in nature? (a) (b) (c) (d) (e) Certificate of deposit Commercial paper Treasury bill Ready forward None of the above KEY 1 (a) 2 (b) 3 (a) 4 (b) 5 (a) 6 (b) 7 (d) 8 (c) 9 (d) 10 (d) 46 CREDIT MANAGEMENT 1. Most commonly, the trade cycle for a business is financed partly by: (a) (b) (c) (d) (e) The sellers The buyers The financiers All the above None of the above 2. A bill of exchange contains a: (a) (b) (c) (d) (e) Unconditional ndertaking to pay Conditional undertaking to pay Unconditional order to pay Conditional order to pay None of the above 3. The beneficiary of a letter of credit is: (a) (b) (c) (d) (e) The seller The buyer The financing bank Either a or b None of the above 4. Which one of the following is not literally part of the „five C? s of credit (a) (b) (c) (d) (e ) Capital Character Capability Collateral None of the above 5. In sequential analysis of creditworthiness, which one of the following should be your starting point? (a) (b) (c) (d) (e) Capital Character Collateral General economic conditions None of the above 7 6. The measure not commonly employed for judging whether accounts receivables are â€Å"in control† is: (a) (b) (c) (d) (e) Ageing schedule Average collection period Bad debt losses Interest collected on delayed payments None of the above 7. In a consignment sale: (a) (b) (c) (d) (e) The title of the goods is with the consignor The title of the good is with the consignee Consignee is an agent of the consignor Both a and c None of the above 8. In type II error: (a) A bad customer is misclassified as a good credit risk. (b) A good customer is misclassified as a poor credit risk (c) None of the above 9. Under the DSO method, if the value of DSO exceeds the specified norm: (a) (b) (c) (d) (e) Collections are considered to be fast Collections are considered to be slow Collections are considered to be satisfactory Collections are considered to be average None of the above KEY 1 (d) 2 (c) 3 (a) 4 (c) 5 (b) 6 (d) 7 (d) 8 (a) 9 (d) 48 INENTORY MANAGEMENT 1. Maintaining ‘organisation' inventories is not for: (a) (b) (c) (d) (e) Reducing the time required for the process Widening the latitude in planning and scheduling successive operations Decoupling the purchasing and production activities to some extent Both b and c None of the above . Which one of the following is not the most commonly used tool of inventory management in India? (a) (b) (c) (d) (e) Just- in-time inventory control ABC analysis FSN analysis Inventory turnover analysis None of the above 3. ABC analysis advocates a selective approach to inventory control with concentration on: (a) (b) (c) (d) (e) Items accounting for the bulk of usage by usage quantity Items accounting for the bulk of usage by usage value The process time related to high value inventory All the above None of the above 4. Which one of the following is not an assumption in the basic EOQ model? (a) The cost of carrying is a fixed percentage of the average value of inventory (b) The cost per order is constant regardless of the size of the order (c) The interval between ordering and receiving goods is constant (d) The usage is even throughout the period (e) None of the above 5. Fixed manufacturing overheads are treated as period costs under: (a) (b) (c) (d) (e) Direct costing Absorption costing Indirect costing Variable costing None of the above 49 6. JIT inventory system requires: (a) (b) (c) (d) (e) Strong and dependable relationship with suppliers Reliable transportation system Either a or b Both a and b None of the above KEY 1 (a) 2 (a) 3 (b) 4 (c) 5 (a) 6 (d) 50 WORKING CAPITAL FINANCING 1. Accruals are treated as part of: (a) (b) (c) (d) (e) Spontaneous financing Regular financing Long- term financing Internal accrual None of the above 2. Which one of the following is the most harmful factor in getting trade credit? (a) (b) (c) (d) (e) Poor earning record Broken promises Unrealistic plans Poor market share None of the above . A firm typically should: (a) Delay the payment till the last day of the net period (b) Delay the payment if possible beyond the net period (c) Avail of the discount for prompt payment in the middle of the discount period (d) Avail of the discount for prompt payment on the last day of the discount period (e) None of the above 4. Which one of the following is not a means of obtaining working capital finan ce? (a) (b) (c) (d) (e) Overdraft Discounting of bills Letter of credit All the above None of the above . In a letter of credit arrangement: (a) (b) (c) (d) (e) Bank assumes the risk Bank supplies the credit Suppliers assume the risk Both a and b None of the above 51 6. In cash credit, the responsibility of cash management lies with: (a) (b) (c) (d) (e) The bank The customer The creditors Both b and c None of the above 7. Which one of the following is typically a demerit of public deposits, for an investor: (a) (b) (c) (d) (e) Interest rate Maturity period Tax exemption Restrictive covenants None of the above . Inter-corporate deposit market is charecterised by: (a) (b) (c) (d) (e) Secrecy Lack of regulations Personal contacts All the above None of the above 9. RBI imposes certain conditions on the terms of issue of a commercial paper because it is: (a) (b) (c) (d) (e) Issued for a short term Issued at a discount to the face value Unsecured Issued for raising working capital None of the above KEY 1 (a) 2 (b) 3 (d) 4 (d) 5 (a) 6 (a) 7 (c) 8 (d) 9 (c) 52 WORKING CAPITAL MANAGEMENT: EXTENSIONS 1. In a MRP system, the master schedule is exploded into: (a) (b) (c) (d) (e) Purchase order for raw materials Shop orders for scheduling the factory Time bound orders for purchase of balancing equipments Both a and b None of the above 2. In which of the following, inventory is treated as the „root of all evil (a) (b) (c) (d) (e) Kaizan Kanban JIT Both b and c None of the above KEY 1 (d) 2 (c) 53 DEBT AND HYBRID FINANCING 1. Market price of a coupon bond is independent of: (a) (b) (c) (d) (e) Maturity period Coupon rate Required rate of return Inflation rate None of the above . Which one of the following can affect real interest rate: (a) (b) (c) (d) (e) Expected higher inflation Tax law changes Heightened competition for funds Both b and c None of the above 3. A debt rating is not a: (a) (b) (c) (d) (e) General evaluation of the issuing organisation Reflection on the timely payment of interest Reflection on the timely payment of principal Recommendation for purchasing a security None of the above 4. Which one of the following is true? a) A debt rating implies that the rating agency performs an audit function (b) A debt rating offers low- cost information (c) A debt rating creates a fiduciary relationship between the rating agency and the users of a rating (d) Both a and b (e) None of the above 5. Which type of firms would do well to incorporate sinking fund provisions in their debt issuances? (a) (b) (c) (d) (e) Firms with higher debt – equity ratio Firms with higher growth rates Firms with smaller asset lives All the above None of the above 54 6. To tackle inflation risk, you will go for: (a) (b) (c) (d) (e) Deep discount bonds Fixed rate bonds Floating rate bonds Inverse floaters None of the above 7. If you are called to fund an airport project, you would prefer to go for (a) (b) (c) (d) (e) deep discount bonds floating rate bonds puttable bonds term loans None of the above 8. Pass Through Securities are serviced from the (a) (b) (c) (d) (e) proceeds of sale of a pool of assets cash flows received from a pool of assets proceeds of a public issue proceeds of a debenture issue for this purpose None of the above . Which one of the following is not a negative covenant in a bond issue? (a) (b) (c) (d) (e) The firm may not dispose or lease its major assets The firm cannot merge with another firm The firm cannot go in for capacity enhancement The firm cannot acquire another firm None of the above 10. When inflation is expected to rise in the coming decade, as a bond issuer, you will prefer to issue (a) (b) (c) (d) (e) Fixed rate bo nds Floating rate bonds Callable bonds Puttable bonds None of the above 55 11. Reinvestment risk for a bond refers to the risk that the periodic interest payment may have to be reinvested at (a) (b) (c) (d) (e) A lower interest rate A higher interest rate A risk-free rate (a) and (c) None of the above 12. For a zero coupon bond (a) (b) (c) (d) (e) Duration is zero Duration is one-half the term to maturity Duration is undefined Duration is the same as the term to maturity None of the above 13. Immunisation attempts to balance (a) (b) (c) (d) (e) Price risk and default risk Price risk and reinvestment risk Recall risk and reinvestment risk Inflation risk and price risk None of the above 4. Which bond has the longest duration? (a) (b) (c) (d) (e) 12-year maturity, 5 % coupon 12-year maturity, 7% coupon 8-year maturity , 7% coupon 8-year maturity , 5 % coupon None of the above 15. Which among the following may not be a plausible reason for a company issuing callable bonds? (a) (b) (c) (d) (e) Superior interest rate forecasting Greater investment flexibility Reducti on in interest rate risk Strategic positioning None of the above 56 KEY 1 (e) 12 (d) 2 (d) 13 (b) 3 (a) 14 (a) 4 (b) 15(d) 5 (d) 6 (c) 7 (a) 8 (b) 9 (c) 10 (a) 11 (a) 57 INTERNATIONAL FINANCIAL MANAGEMENT 1. International foreign exchange market is dominated by (a) (b) (c) (d) (e) Speculative transactions Hedging transactions Mercantile transactions Transactions between central banks None of the above 2. Exchange rates in India are fixed by: (a) (b) (c) (d) (e) Ministry of finance Reserve Bank of India Foreign Exchange Dealers Association of India A committee appointed for this purpose None of the above 3. Commission charged by foreign exchange dealers generally range from: (a) (b) (c) (d) (e) 0. 25 to 0. 50 percent 0. 02 to 0. 05 percent There is no particular range They do not charge any commission None of the above . The bid-ask spread reflects: (a) (b) (c) (d) (e) The breadth of the market The depth of the market The volatility of the market All the above None of the above 5. If the forward bid in points is less than the offer rate in points, which of the following is not true? (a) (b) (c) (d) (e) The foreign currency is at a premium The home currency is at a premium The foreign curr ency is at a discount Both a and b None of the above 6. Currency futures contracts are traded: 58 (a) (b) (c) (d) (e) Over phone/electronic media Over the counter by leading banks In exchanges In all the above In none of the above 7. A tailor made currency option can be purchased from: (a) (b) (c) (d) (e) Organised exchanges Banks dealing in foreign exchange Mercantile agents Investment banks None of the above 8. Eurocurrency market is: (a) (b) (c) (d) (e) 9. The advantage of issuing a GDR is: (a) (b) (c) (d) (e) There is no listing fee Onerous disclosures are not required There are no onerous reporting requirements All the above None of the above Market in which currencies of European nations are traded International market for loans denominated in euro International market for short-term capital International market for long – term capital None of the above 0. Which one of the following attracts stringent listing requirements? (a) (b) (c) (d) (e) Yankee bond ADS GDR Both a and c None of the above 11. Packing credit advance has to be liquidated: (a) (b) (c) (d) (e) By negotiation of export bills By receipt of export proceeds By availing of rupee term loan Either a or b None of the above 59 12. Forfaiting essentially refers to: (a) (b) (c) (d) (e) Financing exporter? s inventory Discounting exporter? s receivables Guaranteeing of the export receivables by the exporter? s bank Surrendering the export proceeds in favour of the discounting bank None of the above 3. The beneficiary of a Letter of Credit is: (a) (b) (c) (d) (e) Importer Exporter Exporter? s bank Importer? s bank None of the above 14. Forward contracts are entered into to hedge: (a) (b) (c) (d) (e) Transaction exposure Translation exposure Operating exposure All the above None of the above 15. Which one of the following may not be a means of mitigating operating exposure? (a) (b) (c) (d) (e) Change in sourcing Shift in the location of production Change in product-market combination Leading and lagging None of the above 6. As foreign exchange market is an OTC market, which of the following is not true? (a) (b) (c) (d) There is lesser price transparency Trades can be customised in terms of maturities There is risk of counter party default There cannot be differences in the exchange rates for the same currency pair, for different counterparties (e) None of the above 60 17. Which of the following currency is traded in both the euromarket and the offshore market? (a) (b) (c) (d) (e) US Dollar British Pound Euro All the above None of the above 18. The spread over SIBOR for a given borrowing is also a function of the prevailing market conditions: a. True b. False 19. Bonds issued by a German company in the US, denominated in dollars are : (a) (b) (c) (d) (e) Foreign bonds Domestic bonds Eurobonds International bonds None of the above 20. In the case of GDRs issued by Indian companies, the reverse conversion i. e. from shares to GDRs is freely permitted: a. True b. False KEY 1 (a) 12 (b) 2 (e) 13 (b) 3 (d) 14 (a) 4 (d) 15 (d) 5 (a) 16(d) 6 (c) 17(d) 7 (b) 18(a) 8 (c) 19(a) 9 (d) 20(b) 10 (a) 11 (d) 61 FINANCIAL MANAGEMENT OF SICK UNITS . RBI study on the causes of industrial sickness shows that the incidence of sickness is highest in India on account of: (a) (b) (c) (d) (e) Labour trouble Market recession Mismanagement and managerial deficiencies Faulty initial planning and other technical drawbacks None of the above 2. If CDR is not possible, the restructuring may be done through: (a) (b) (c) (d) (e) NS OTS ADB Either a or b No ne of the above 3. Which of the following is not a reason for classifying a unit as sick by term lending financial institutions? (a) (b) (c) (d) (e) Default in meeting a certain no. f consequent instalments Continued erosion of market share Cash losses for a certain period Continued erosion of net worth , say by 50 percent None of the above KEY 1 (c) 2 (d) 3 (b) 62 CORPORATE RISK MANAGEMENT 1. Economic risks mostly may not arise on account of : (a) (b) (c) (d) (e) Output price R&D Labour cost Competitive environment None of the above 2. In general, which among the following may not have any significant impact on the performance of a firm? (a) (b) (c) (d) (e) Economic risks Financial risks Technological risks Regulatory risks None of the above 3. Hedging activities aimed at reducing total corporate risk, are regarded as irrelevant by modern finance theory: a. True b. False 4. According to CAPM, only the unique risk has a bearing on the required rate of return: a. True b. False 5. Greater financial flexibility to cope with volatility in financial prices is provided by a: (a) (b) (c) (d) (e) High current ratio High gearing ratio Low gearing ratio High quick ratio None of the above 6. R2 refers to the : (a) (b) (c) (d) Coefficient of multiple regression Variance of regression Coefficient of multiple correlation Coefficient of multiple covariance 63 e) None of the above 7. Total risk cannot be fully offset by hedging with market portfolio: a. True b. False 8. If you want to hedge interest rate risk, you should (a) (b) (c) (d) (e) Go long on interest rate contract Go short on interest rate contract Sell a forward contract Enter into a forward rate agreement None of the above 9. Futures are forward contracts: a. True b. False 10. Y ou will not be marked to market, if you: (a) (b) (c) (d) (e) Purchase a futures contract Sell a futures contract Purchase an options contract Sell an options contract None of the above 11. In a currency swap interest payments are not swapped: a. True b. False 12. Which of the following may not be a reason for going in for a financial swap? (a) (b) (c) (d) (e) Spread compression Market segmentation Market saturation Difference in financial norms None of the above 13. Which among the following is not standardized: (a) (b) (c) (d) (e) Options contract Futures contract Swap contract All the above None of the above 64 14. Insurance companies do face the problem of adverse selection but not that of moral hazard: a. True b. False 15. Globally the most popular measure of risk is: (a) (b) (c) (d) (e) Duration VAR R2 Gap analysis None of the above 6. For commodities the following relationship is expected to hold: Futures price (a) (1+rf)t Futures price (b) (1+rf)t Futures price (c) (1+rf)t Futures price (d) (1+rf)t (e) None of the above = Spot price – Present value of storage costs + Present value of convenience yield = Spot price + Present value of storage costs – Present value of convenience yield = Spot price+Present value of storage costs + Present value of convenience yield = Spot price KEY 1 (b) 12(e) 2 (e) 13(c) 3(a) 14(b) 4(b) 15(b) 5(c) 16(c) 6(c) 7(a) 8(d) 9(a) 10(c) 11(b) 65