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प्रश्न
Explain the following as factor affecting 'financing decision'.
State of capital markets
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उत्तर
State of the capital market: During the boom period, it is easy to receive funds through equity. On the other hand, during a depression, it becomes difficult to receive funds through equity. Under such circumstances, it is preferable to receive funds through debt.
Bullish Market: Equity preferred
Bearish Market: Debt preferred
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संबंधित प्रश्न
Vasvi was a student of Commerce in class XII. Her father was a farmer, who grew different varieties of wheat and was well versed about various aspects of wheat cultivation. He was also selected by the government for a pilot-project on wheat cultivation. As a project, she decided to study the feasibility of marketing good quality wheat at the reasonable price. Her father suggested to her to use the internet to gather customers’ views and opinions. She found that there was a huge demand for organic packed wheat. She knew that there were no pre-determined specifications in case of wheat, because of which it would be difficult to achieve uniformity in the output. To differentiate the product from its competitors, she gave it the name of ‘Mahan-organic wheat’ and classified it into three different varieties namely — Popular, Classic and Supreme, based on the quality. She felt that these names would help her in product differentiation.
Explain the three functions of marketing, with reference to the above paragraph
Explain the following as factor affecting dividend decision:
Stability of earnings
Explain the following as factor affecting dividend decision:
Cash flow position
Explain the following as factor affecting dividend decision:
Taxation policy
Explain the following as factor affecting dividend decision:
Stability of dividends
Explain the following as factor affecting dividend decision:
Shareholder's preferences
Explain the following as factor affecting dividend decision:
Access to capital market
Explain the following as factor affecting dividend decision:
Legal constraints
Explain the following as factor affecting 'financing decision'.
Cash flow position of the business
Explain the following as factor affecting 'financing decision'.
Level of fixed operating cost
Give the meaning of ‘Investment’ and ‘Dividend’ decisions of financial management.
What is ‘Financial Risk?’ Why does it arise?
Financial management is based on three broad financial decisions. What are these?
| Ananta Ltd. is a company dealing in ready-made garments for the last many years. Recently the profit of the company has started increasing. The finance manager decided to retain the profit instead of distributing it among shareholders. |
- Identify and state the financial decision taken by the finance manager in the above case.
- State any three factors affecting the decision identified in (i) above.
|
NB Ltd. is India's largest manufacturer of cement. Its operations are spread throughout the country with 17 modern cement factories. It has a workforce of 9,000 people. Since its inception, the company has been a trendsetter in the cement industry. The company is planning to grow in the long run and wants to double its capacity in the next 3 years. For this, the Finance Manager has to decide about the quantum of finance to be raised from various long-term sources. For this, he needs to identify various available sources of funds and the proportion of funds from each source. |
- Identify the financial decision to be taken by the Finance Manager.
- State any four factors which would affect the decision identified in (i) above.
