The type of debt whose rate of interest changes according to the changes in the rate of interest payable on gilt edged securities or the prime lending rate of the bank is called

Related MCQs

• Consider the below mentioned statements: 1. A debt-equity ratio of 2:1 indicates that for every 1 unit of equity, the company can raise 2 units of debt. 2. The cost of floating a debt is greater than the cost of floating an equity issue. State True or False:
• If the following are balance sheet changes: Rs. 5,005 decrease in accounts receivable Rs. 7,000 decrease in cash Rs. 12,012 decrease in notes payable Rs. 10,001 increase in accounts payable a "use" of funds would be the:
• The cost of debt capital is the ratio of interest payable on ---------
• If the weighting of equity in total capital is 1/3, that of debt is 2/3, the return on equity is 15% that of debt is 10% and the corporate tax rate is 32%, what is the Weighted Average Cost of Capital (WACC)?
• In MM Model with taxes, where 'r' is the interest rate, ‘D’ is the total debt and 't' is tax rate, then present valued shields would be:
• The cost of debt capital if interest rate is 15% and tax rate is 40% is
• Debt to Total Assets of a firm is .2. The Debt to Equity boo would be:
• In case of Net Income Approach, when the debt proportion is increased, the cost of debt:
• Debt-to-total assets (D/TA) ratio is .4. What is its debt-to-equity (D/E) ratio?
• The use of long term fixed interest bearing debt and preference share capital along with equity shares is called