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JAIPUR NATIONAL UNIVERSITY, JAIPUR
School of Distance Education & Learning
Internal Assignment No. 1
Master of Business Administration
Paper Code: MBA– 111
Paper Title: Financial Management
Last date of submission: Max. Marks: 30
Note: Question No. 1 is of short answer type and is compulsory for all the
students. It carries 1 Mark each.
(i) What is risk? How do you distinguish between systematic and unsystematic risk?
Answer: Risk is the potential of gaining or losing something of value.[1] Values (such as physical
health,social status,emotional well-beingorfinancial wealth) canbe gainedorlost when taking risk
resulting from a given action or inaction, foreseen or unforeseen. Risk can also be defined as the
intentional interaction
(ii) Define “Miller and Orr model” of cash management.
Answer: The Miller and Orr model of cash management is one of the various cash management
models in operation. It is an important cash management model as well. It helps the present day
companiestomanage theircash while taking into consideration the fluctuations in daily cash flow.
As per the Miller and Orr model of
(iii) State the features of money market.
Answer:Distinguishingfeaturesof moneymarketare givenbelow:1.Constituents of Money Market
2. Heterogeneous Market 3. Dealers of
(iv) Define the significance of international finance management.
Answer: International Finance is an area of financial economics that deals with monetary
interactionsbetweentwoormore countries,concerningitself withtopicssuchascurrency exchange
rates, international monetary
(v) State the relationship between BOP and national economy.
Answer: Gross Domestic Product (GDP) and Gross National Income (GNI) are core statistics in
National Accounts. Theyare bothimportanteconomicindicatorsanduseful foranalysingthe overall
economic situation of an economy
(vi)Differentiate “arbitration” and “speculation” in foreign exchange market.
Answer: Arbitrage is where a trader will simultaneously purchase and sell an asset with hopes to
make a profitfromthe differencesin the price levelsof the asset that is bought and the asset that is
beingsold.Itmust be kept in mind that the assets are bought and sold off different market places;
(vii) Define marginal cost of capital.
Answer: Definition
The cost associatedwithraisingone additional dollarof capital.The marginal costwill varyaccording
to the type of capital used.Forexample,raisingfundsthroughthe use of unsecuredorsubordinated
(viii) Write a short note on JIT.
Answer: JIT is defined as “A technique for the organisation of work-flows, to allow rapid, high
quality,flexibleproductionwhilstminimising manufacturing waste and stock levels.” (CIMA official
(ix) What are the conditions for the redemption of redeemable preference share?
Answer: 1) Subject to this section a company having a share capital may, if so authorized by its
articles, issue preference shares which are, or at the option of the company are to be, liable to be
redeemed and the redemption shall be effected only on such terms and in such manner as is
(x) Mention the different types of dividend paid by companies.
Answer: (1) Subject to this section a company having a share capital may, if so authorized by its
articles, issue preference shares which are, or at the option of the company are to be, liable to be
redeemed and the redemption shall be effected only on such terms and in such manner as is
provided by the articles.
NOTE: Answer any four questions. Each question carries 5 Marks. (500
Words).
Q.2 What do you understand by “Financial Management”? Discuss its significance in
Business Management.
Answer: Meaning of Financial Management
Q.3 What is capital budgeting? Critically examine the various methods of evaluation of
capital Budgeting proposals.
Answer: Capital budgeting is the process in which a business determines and evaluates potential
expenses or investments that are large in nature. These expenditures and investments include
projectssuchas buildinganewplantor investinginalong-termventure.Often times, a prospective
Q.4 Define dividend policy. Explain briefly the factors which affect the dividend policy of a
firm.
Answer: A dividend policy is a company's approach to distributing profits back to its owners or
stockholders. If a company is in a growth mode, it may decide that it will not pay dividends, but
Q.5 What is meant by inventory control? Explain the different costs associated with
inventory.
Q.6 Define cash management. Discuss in detail the factors that determine the needs cash
of a firm.
Answer: Cash management is the corporate process of collecting, managing and (short-term)
investingcash.A keycomponentof ensuringacompany'sfinancial stabilityandsolvency.Frequently
Dear students, get latest JNU MBA Solved assignments by professionals.
Mail us at: help.mbaassignments@gmail.com
Call us at: 08263069601

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Mba 111 - financial management

  • 1. Dear students, get latest JNU MBA Solved assignments by professionals. Mail us at: help.mbaassignments@gmail.com Call us at: 08263069601 JAIPUR NATIONAL UNIVERSITY, JAIPUR School of Distance Education & Learning Internal Assignment No. 1 Master of Business Administration Paper Code: MBA– 111 Paper Title: Financial Management Last date of submission: Max. Marks: 30 Note: Question No. 1 is of short answer type and is compulsory for all the students. It carries 1 Mark each. (i) What is risk? How do you distinguish between systematic and unsystematic risk? Answer: Risk is the potential of gaining or losing something of value.[1] Values (such as physical health,social status,emotional well-beingorfinancial wealth) canbe gainedorlost when taking risk resulting from a given action or inaction, foreseen or unforeseen. Risk can also be defined as the intentional interaction (ii) Define “Miller and Orr model” of cash management. Answer: The Miller and Orr model of cash management is one of the various cash management models in operation. It is an important cash management model as well. It helps the present day companiestomanage theircash while taking into consideration the fluctuations in daily cash flow. As per the Miller and Orr model of (iii) State the features of money market.
  • 2. Answer:Distinguishingfeaturesof moneymarketare givenbelow:1.Constituents of Money Market 2. Heterogeneous Market 3. Dealers of (iv) Define the significance of international finance management. Answer: International Finance is an area of financial economics that deals with monetary interactionsbetweentwoormore countries,concerningitself withtopicssuchascurrency exchange rates, international monetary (v) State the relationship between BOP and national economy. Answer: Gross Domestic Product (GDP) and Gross National Income (GNI) are core statistics in National Accounts. Theyare bothimportanteconomicindicatorsanduseful foranalysingthe overall economic situation of an economy (vi)Differentiate “arbitration” and “speculation” in foreign exchange market. Answer: Arbitrage is where a trader will simultaneously purchase and sell an asset with hopes to make a profitfromthe differencesin the price levelsof the asset that is bought and the asset that is beingsold.Itmust be kept in mind that the assets are bought and sold off different market places; (vii) Define marginal cost of capital. Answer: Definition The cost associatedwithraisingone additional dollarof capital.The marginal costwill varyaccording to the type of capital used.Forexample,raisingfundsthroughthe use of unsecuredorsubordinated (viii) Write a short note on JIT. Answer: JIT is defined as “A technique for the organisation of work-flows, to allow rapid, high quality,flexibleproductionwhilstminimising manufacturing waste and stock levels.” (CIMA official (ix) What are the conditions for the redemption of redeemable preference share? Answer: 1) Subject to this section a company having a share capital may, if so authorized by its articles, issue preference shares which are, or at the option of the company are to be, liable to be redeemed and the redemption shall be effected only on such terms and in such manner as is (x) Mention the different types of dividend paid by companies. Answer: (1) Subject to this section a company having a share capital may, if so authorized by its articles, issue preference shares which are, or at the option of the company are to be, liable to be redeemed and the redemption shall be effected only on such terms and in such manner as is provided by the articles.
  • 3. NOTE: Answer any four questions. Each question carries 5 Marks. (500 Words). Q.2 What do you understand by “Financial Management”? Discuss its significance in Business Management. Answer: Meaning of Financial Management Q.3 What is capital budgeting? Critically examine the various methods of evaluation of capital Budgeting proposals. Answer: Capital budgeting is the process in which a business determines and evaluates potential expenses or investments that are large in nature. These expenditures and investments include projectssuchas buildinganewplantor investinginalong-termventure.Often times, a prospective Q.4 Define dividend policy. Explain briefly the factors which affect the dividend policy of a firm. Answer: A dividend policy is a company's approach to distributing profits back to its owners or stockholders. If a company is in a growth mode, it may decide that it will not pay dividends, but Q.5 What is meant by inventory control? Explain the different costs associated with inventory. Q.6 Define cash management. Discuss in detail the factors that determine the needs cash of a firm. Answer: Cash management is the corporate process of collecting, managing and (short-term) investingcash.A keycomponentof ensuringacompany'sfinancial stabilityandsolvency.Frequently Dear students, get latest JNU MBA Solved assignments by professionals. Mail us at: help.mbaassignments@gmail.com Call us at: 08263069601