Financial Management Quiz
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Questions and Answers

What is the market value of the levered firm Y's debt?

  • Rs.50,000
  • Rs.48,000
  • Rs.12,000
  • Rs.60,000 (correct)
  • What is the formula to calculate the Net Earnings (NI) of a levered firm?

  • $NI = EBIT - Tax$
  • $NI = EBIT - Interest$ (correct)
  • $NI = EBIT - Interest - Tax$
  • $NI = EBIT + Interest$
  • What is the cost of debt for the levered firm X?

  • 12%
  • 10% (correct)
  • 6%
  • 11%
  • What is the formula to calculate the total net income of a firm?

    <p>Total Net Income = EBIT - Interest</p> Signup and view all the answers

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