12. Exam Paper for Financial Management in BBA (With Answers)

,Exam Paper for Financial Management in BBA (With
Answers)

PAPER # 1


**Financial Management Exam**
**BBA Program**
**Duration: 2 hours**


**Instructions:**
1. This exam consists of two parts: Multiple Choice Questions (MCQs) and
Short Answer Questions.
2. Part A contains 20 MCQs. Select the most appropriate answer by circling
the corresponding letter.
3. Part B contains 5 Short Answer Questions. Provide detailed answers.
4. Answer all questions.
5. Show all calculations for Part B.


**Part A: Multiple Choice Questions (20 points)**


1. Which of the following is not a primary objective of financial
management?
a) Profit maximization
b) Wealth maximization
c) Risk minimization
d) Revenue maximization



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, 2. The time value of money concept is based on the idea that:
a) Money today is worth more than money in the future
b) Money in the future is worth more than money today
c) Money has a constant value over time
d) Money's value depends on inflation rates


3. What is the formula for calculating the Net Present Value (NPV) of a
project?
a) NPV = Initial Investment - Total Cash Flows
b) NPV = Total Cash Flows / Initial Investment
c) NPV = Initial Investment / Total Cash Flows
d) NPV = Total Cash Flows - Initial Investment


4. A company's ability to meet its short-term obligations is assessed using
the:
a) Current ratio
b) Debt ratio
c) Quick ratio
d) Debt-to-equity ratio


5. What is the formula for calculating the Weighted Average Cost of Capital
(WACC)?
a) WACC = (Debt / Equity) * Cost of Debt
b) WACC = (Equity / Total Assets) * Cost of Equity
c) WACC = (Weighted Cost of Debt + Weighted Cost of Equity)




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