Correct Answer: Primary market
 

Solution : The correct answer is (a) Primary market

If MNO Inc. is considering issuing bonds to finance its acquisition plans, it represents a primary market activity. The primary market is where new securities, such as bonds and stocks, are issued for the first time and sold directly by the issuing company to investors. In this case, MNO Inc. would issue bonds to raise funds for its acquisition plans. Investors would purchase these newly issued bonds directly from MNO Inc., and the company would receive the proceeds from the sale of these bonds. This infusion of capital from the sale of bonds would then be used to finance the acquisition of other companies, helping MNO Inc. diversify its business operations.

The secondary market, on the other hand, is where existing securities are bought and sold among investors, and the issuing company does not directly receive proceeds from these transactions. The money market primarily deals with short-term debt securities, and the capital market encompasses both the primary and secondary markets for long-term securities.

Correct Answer: Assertion is true, but the reason is false.

Solution : The correct answer is (c) Assertion is true, but the reason is false.

The assertion is true. Financial planning involves efficiently allocating funds and resources to various activities within a business, aiming to achieve the company's financial goals and objectives.

The reason is false. Financial planning is a comprehensive process that involves the allocation of funds to various areas within a business based on the organization's goals and priorities. While marketing may be one area where funds are allocated, financial planning covers all aspects of resource allocation, not just marketing.

Correct Answer: Reserve Bank of India

Solution : The correct answer is the Reserve Bank of India.

As per Section 22 of the Act, the Reserve Bank of India (RBI) has the exclusive authority to issue banknotes in India. Section 25 empowers the central government to approve the design, form and material of banknotes based on recommendations from the Central Board of the RBI.

Correct Answer: By utilizing accumulated profits

Solution : The correct answer is (c) By utilizing accumulated profits

Retained earnings are the portion of net profits that a company keeps and reinvests in the business rather than distributing them as dividends to shareholders. PQR Enterprises can utilize these accumulated profits or retained earnings to fund its diversification initiatives, such as entering new markets, developing new products, or expanding into different business areas. 

Correct Answer: enough

Solution : The correct choice is the first option.

Explanation: The sentence structure indicates a need for a term that highlights the inadequacy of job creation compared to the expanding population. "Enough" in this context emphasises the lack of sufficient job opportunities despite India being a fast-growing economy.

Correct Answer: Instruments for raising capital in global markets

Solution : The correct answer is (d) Instruments for raising capital in global markets

GDRs (Global Depository Receipts) and ADRs (American Depositary Receipts) are financial instruments that companies can use to raise capital in global markets. GDRs are typically issued outside the United States and ADRs are issued in the United States. Both GDRs and ADRs represent ownership in the issuing company and enable companies to access international investors and raise funds by listing and trading these instruments on international stock exchanges. This facilitates global investment in the company's shares.

Correct Answer: No dilution of ownership
  

Solution : The correct answer is (a) No dilution of ownership

Preference shares allow companies to raise funds without diluting ownership stakes or control. Unlike issuing additional common equity shares, issuing preference shares does not dilute the ownership of existing shareholders because preference shareholders do not have voting rights and do not participate in the day-to-day decision-making of the company. It allows the company to secure necessary capital while maintaining ownership concentration among existing shareholders. The fixed dividend payments associated with preference shares (option b) are also a characteristic but are not directly related to the advantage of no dilution of ownership.

Correct Answer: Statement 1 is true, and statement 2 is false.
   

Solution : The correct answer is (a) Statement 1 is true, and statement 2 is false.

Statement 1 is true. The need for business finance often arises due to uncertainties and risks in business operations. Businesses need financial resources to mitigate risks, navigate uncertainties, and ensure smooth operations.

Statement 2 is false. Financial planning aims to manage and mitigate risks, but it does not eliminate all uncertainties in business activities. Uncertainties are inherent in business, and while financial planning can help in managing and preparing for them, it cannot completely eliminate them.

Correct Answer: President 

Solution : The correct answer is President.

Article 77 of the Indian constitution mentions that all the executive actions of the Union of India should be done on the name of President. It mentions President as the executive head of the state. Article 58 provides for the eligibility for becoming the President of India. According to it President must be a citizen of India and he should not be less than 35 years of age. 

Correct Answer: Maximizing shareholder wealth
   

Solution : The correct answer is (a) Maximizing shareholder wealth

Financial planning in a corporation involves strategies and actions aimed at optimizing the use of financial resources to achieve long-term goals and ultimately enhance shareholder wealth. It encompasses planning for investments, managing cash flows, optimizing capital structure, and making informed financial decisions to increase profitability, drive growth, and maximize the value of the business for its shareholders. While meeting daily operational expenses and ensuring efficient resource utilization are important aspects of financial planning, the overarching objective is to create value and wealth for the shareholders.