Home > Class 11 Biology > Quizzes > CS Executive Practice Test: Capital Structure Decisions
CS Executive Practice Test: Capital Structure Decisions
Fast practice, instant feedback. Timer auto-submits when time’s up.
Avg score: 100% • Most missed: “One can design a capital structure with proper proportions of equity, preference…”
CS Executive Practice Test: Capital Structure Decisions
Time left 00:00
25 Questions

1. Market values are often used in computing the weighted average cost of capital because
2. Which of the following shows the significance of capital structure?
3. The manner in which an organization’s assets are financed is referred to as its –
4. Financial structure is___ concept while the capital structure is__ concept.
5. Capital structure relates to capital deployment for the creation of assets.
6. The financial structure involves the creation of ___
(1) Long term assets
(2) Short term assets
Select the correct answer from the options given below.
7. The optimal capital structure consists of –
8. _____refers to the mix of a firm’s capitalization and includes long term sources of funds.
9. Which of the following step would you recommend to avoid the negative consequences of overcapitalization?
10. Which one of the following statements concerning financial leverage is correct?
11. Which of the following is not included in the capital structure?
12. EBIT of R Ltd. is ₹ 5,00,000. The company has 10%, ₹ 20,00,000 debentures. The equity capitalization rate i.e. Ke is 16%. Calculate the market value of the firm as per the Net Income (NI) Approach. Ignore taxation.
13. Which of the following capital structure consist of zero debt components in the structure mix?
14. If the debt component in the capital structure is predominant –
15. Which of the following statement is incorrect?
(1) High debt funds in capital structure increase EPS.
(2) High debt funds increase the operating or business risk.
Select the correct answer from the options given below.
16. Ganesha Ltd. is setting up a project with a capital outlay of ₹ 60,00,000. It has two alternatives in financing the project cost.
Alternative (a): 100% equity finance
Alternative (b): Debt-equity ratio 2:1
The rate of interest payable on the debts is 18% p.a. Corporate tax rate is 40%. Calculate the indifference point between the two alternative methods of financing.
17. Assertion (A):
The capital structure acts as a tax management tool also.
Reason (R):
A relatively lesser component of equity capital is vulnerable to hostile takeovers.
Select the correct answer from the options given below
18. According to Cost Principle, an ideal pattern or capital structure is one that –
19. Which term would most likely be associated with the phrase “actions speak louder than words”?
20. M & M Proposition I, without taxes, states that:
21. External sources of finance do not include:
22. Take the data of the above question and calculate the overall cost of capital.
23. Assertion (A):
The capital structure should be determined within the debt capacity of the company and this capacity should not be exceeded.
Reason (R):
The debt capacity of a company depends on its ability to generate future cash flows. It should have enough cash to pay creditors’ fixed charges and principal sum.
Select the correct answer from the options given below
24. Which of the following statement is false?
25. The term “capital structure” refers to:

⚡ Recently practiced quizzes in this topic
Live quiz activity
Class 11 Biology: Cell - The Unit of Life Class 11 Biology Practice Test: The Living World - Diversity in the Living World Class 11 Biology Practice Test: Structural Organisations in Animals - Frogs Class 11 Biology Practice Test: Morphology of Flowering Plants - Flower Class 11 Biology Practice Test: Morphology of Flowering Plants - Fabaceae, Solanaceae and Lillaceae Class 11 Biology: Animal Kingdom Class 11 Biology Practice Test: Cell The Unit of Life - Prokaryotic Cells Class 11 Biology Practice Test: Cell The Unit of Life - Nucleus Class 11 Biology: Plant Kingdom Class 11 Biology Practice Test: Plant Growth and Development - Differentiation, Dedifferentiation & Redifferentiation
 
❤ If you liked Fatskills, consider supporting us by checking out The Life Manuals You Never Got.

🌈  Our mission is to help improve your scores in any subject and exam withonline quizzes, practice tests, study guides, & advice for students. Since 2018.
About | Explore | User Guide | Topics | Subjects | Doubt Solver | Career Aptitude Test | Answers | Free Tools | What Should We Know?
Privacy | Terms |
Without work one finishes nothing. - Ralph Waldo Emerson
© 2026 Fatskills.com

All trademarks, logos and brand names are the property of their respective owners. All company, product and service names used in this website are for identification purposes only. Use of these names, trademarks and brands does not imply endorsement.