Finance Answers

Working capital is considered as excess of Current assets over current liabilities but companies

like HUL, Godrej, Bharti airtel, Hero Motorcorp, faces negative working capital in their operating life.

Thus their current liabilities exceed their current assets in some years.

What is your belief in this regard, can working capital ever be negative or Zero for any company? If

yes than what shall be the repercussions if a company has (a) dearth of Working Capital and (b)

overload of Working Capital?

● Assessment​ :

Tax, control, and protect: which is more important?

Government seeks to regulate finance firms in order to collect tax revenues or to better control businesses and the economy or to protect consumers. Which of these objectives do you think is the most important and most likely to guide government policy decisions? and why

what are national income statistics of a country

Which of the following statement regarding stock "spread" is correct?


A trader initiating a transaction is said to supply liquidity; the counterparty demands liquidity


The bid-offer spread is the difference between the prices quoted for sale and for purchase.


A stock's bid-offer spread is the sole component of a transaction cost.


All of these answers.

1. What are some of the tasks investment banks undertake when they advise companies?


Negotiate the terms of the acquisition between the acquiring and acquired business.


All of these answers.


Prepare the company's pitch book.


Find companies that might be interested in acquiring the business.

Find internal rate of return for the project whose cash flows are as flows: 8

Initial investment = Rs.5,00,000

Annual benefit = Rs. 1,50,000

Annual cost = Rs.30,000

Salvage value = Rs. 40,000

MARR = 12% per year

perform sensitivity analysis using PW Method over a range of (+ or -) 20% in

i. initial investment. ii. net annual revenue

iii. salvage value iv. useful life:


Initial investment (Rs) = 200,000

Annual revenue (Rs) =50,000

Annual expenses (Rs) =5,000

Salvage values (Rs) =25,000

Useful life =10 yrs

MARR =12% Per year

Draw also the sensitivity graph.

Express cash flow as uniform payment series for 10

years that is equivalent to a payment series of Rs. 50,000 at the end of first year, decreasing by Rs.

5,000 each year over 10 years at interest rate of 16% per year compounded annually.

Evaluate the following project with the help of ERR for external

reinvestment rate 20% per year and MARR 18% per year. 7

Initial investment =Rs. 4,000,000

Expected life =8 Years

Salvage value =Rs. 50,000

Annual expenses =Rs. 160,000

Annual revenue =Rs. 320,000

Describe different categories of investments in financial assets and list the accounts used by giving examples