Question : Which of the following statement is incorrect for capital budgeting decisions?
 

Option 1: The decisions have long term implications for the firm.
 

Option 2: These decisions involve large amount of funds.
 

Option 3: It involves less amount of risk.

 

Option 4: None of the above

Question : Which of the following statement is incorrect for factors affecting requirement of fixed capital?
 

Option 1: The natural business determines the amount of fixed capital to a large extent.
 

Option 2: Firms which operate at small scale required large amount of fixed capital.
 

Option 3: Production techniques adopted by Business influence the requirement of fixed capital.
 

Option 4: None of the above

Question : Which of the following statements is incorrect?

 

Option 1: The total risk depends on both the business risk and the financial risk.
 

Option 2: Issue of debt does not dilute the control of equity shareholders.
 

Option 3: Operating cost refers to the cost involved in issue of securities
 

Option 4: None of the above

Question : Which of the following statement is correct?
 

Option 1: Financial risk refers to risk of enability to meet a fixed operating costs.
 

Option 2: Business risk refers to risk of inability to meet fixed financial charges.
 

Option 3: Flotation cost refers to cost involved in the issue of securities.
 

Option 4: None of the above

Question : Which of the following is not the importance of capital budgeting decision?

Option 1: Long term growth and effects

Option 2: Irreversible decisions

Option 3: Facilitates financial control

Option 4: Large amount of funds available