MMPF-002 Capital Investment and Financing Decisions Solved Question Paper June 2024

MMPF-002 Capital Investment and Financing Decisions Solved Question Paper June 2024

Capital Investment and Financing Decisions
Course Code: MMPF-002

1. Describe the Cardinal principles of financing
decisions. Discuss wealth maximisation and
maximization of profit pool objectives.
[ 2 ] MMPF–002
2. XYZ Ltd. has the following capital structure :
Particulars
Market
Values
Book
Values
Cost (%) (` in
crores)
Equity
share
capital 80 120 18
Preference
share
capital 30 20 15
Fully
secured
debentures 40 40 14
Calculate the company’s weighted average cost
of capital based on both market values and
book values. Cost of individual sources of
capital is net of tax.
3. What is Work Breakdown Structure (WBS) ?
Explain the application of WBS to monitor and
control a project.
4. What do you understand by project control ?
Discuss in detail the types of control processes.
5. Explain the concept of risk and uncertainty and
discuss any two techniques used for
measurement of project risk.
[ 3 ]
6. Explain the various instruments through which
companies raise equity capital.
7. How would you assess mergers as a source of
value addition ? What criteria is used for
determining exchange ratio in a merger process ?
8. What is Financial Engineering ? Discuss the
factors leading to financial engineering.