IGNOU MMPF-002 June 2025 Previous Year Question Paper

Q1.(a) What is the meaning of Capital Structure ? Discuss the major consideration in capital structure planning.

(b) XYZ Ltd. has 1000000 shares of ` 10 each with market price of ` 50 per share. It has also issued bonds of ` 4 crore @ 12% per annum. It is considering expansion plan and needs to raise ` 5 crore. The alternatives considered are :

(i) Issue of equity at ` 40 per share

(ii) Issue bonds at 10% per annum

(iii) Issue preference shares @ 12% per annum

(iv) Finance 50% with equity at ` 40 per share and 50% with bonds @ 10% per annum The company is in the tax bracket of 35%. If the company generates EBIT of ` 2.50 crores after expansion which method is best from shareholders point of view ? [ 3 ]

Q2.Describe the distinguishing features of a project and explain the concept of Project Life Cycle.

Q3.How are cash flows for capital budgeting estimated ? Describe the various discounting techniques u sed for capital budgeting decisions.

Q4.What are the various categories of controls required for project implementation ?

Q5.Explain the cybernetic and Go/No -go control process.

Q6.What do you understand by Social Cost - Benefit Analysis (SCBA) ? Describe the basic steps required for conducting SCBA.

Q7.Write short notes on the following :

(a) Bonds

(b) Venture Capital

(c) Asset Securitization

(d) External Commercial Borrowings [ 4 ]

Q8.What are the dimensions of corporate restructuring ? How will you assess merger as a source of value addition ?

Q9.Explain the Financial Engineering Process.

Q10.Discuss innovations that took place in equity product s and explain what they achieve.