IGNOU MCO-07 December 2016 Previous Year Question Paper

Q1.Explain the nature of finance function and the concepts of 'profit maximisation' and 'wealth maximisation. 10, 5,

Q2.(a) Define 'Money Market' and state its 10 characteristics. State the risks faced by investors in financial 10 markets. What is equity share capital ? Explain the 10 features of equity shares. The initial cash outlay of a project is 10 Z 1,00,000 and it generates cash inflows of Z 40,000, ! 30,000, Z 50,000 and Z 20,000. Assume a 10% rate of discount. Calculate profitability index. Pv. of Z 1 at 10% from 1st year to 4th year is .909, .826, .751 and .683 respectively.

Q3.(a) Explain the meaning and importance of the 10 cost of capital.

(b) Write a brief note on CAPM.

Q4.(a) What is leverage ? Explain the types of 10 leverages.

(b) Distinguish between leasing and hire 10 purchasing.

Q5.(a) State the various sources of funds for 10 financing international operations and explain any one of them.

(b) What is foreign exchange market ? Describe 10 its functions and uses.

Q6.(a) Calculate the combined leverage and 10 operating leverage from the following data : Sales 5,00,000 units at 10 per unit variable cost per unit 3.50 Fixed charges 5,00,000 Interest charges 2,00,000

(b) What is cash management ? Discuss its 10 objectives.

Q7.(a) Describe the concept of Inventory 10 management and state arguments for holding inventory.

(b) Discuss the recent development in capital 10 market.

Q8.Write short notes on any two of the following : 10, 10

(a) Project Financing

(b) EBIT-EPS Analysis

(c) Cost of capital

(d) Capital Budgeting

Q10.(a) .1-ciiiil'*31 .O .R.4 1:1 -0e41.-0-ii1 10

(b) yrk4yrd+fir f9lirTur (CAPM) IR 10 feccruft fffrURI

Q11.(a) c -1--dtq . AzTT T -eTzite*a -q' fqfqq. 3rc4 10

(b) 4zzl (Leasing) . 2.11 1 717:11Wcf (hire purchasing) 10 4q -11-A-R I

Q12.(a) attitzT isntia fq111 *d1 10 z/N .W .A.R.a.2ti4-14141-*74

(b) fad rcir1 1-141 ellglIt azrr -r-eTzft? 7rk 10 Oztrzh7Ww

Q16.Pi 4-iicirism if ravii t TR Tf-Rt remiulqi 1-4E17 :

(a) 4 ti Ali falli l

(b) EBIT-EPS iak quf

(c) STa ovin

(d) IQ if Ti