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    Institute of Management Technology: Centre For Distance Learning

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    abhimani5472
    This document contains an exam for the subject Indian Financial Services. [SECTION A] contains 7 multiple choice questions about various topics in financial services. [SECTION B] presents a case study about a company deciding whether to purchase or lease a machine. It provides financial details about the purchase and leasing options and asks the student to advise which option is better for the company and assess the viability of the leasing option for the lessor. The exam is out of 50 marks and contains short answer and calculation questions.

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    Institute of Management Technology: Centre For Distance Learning

    Uploaded by

    abhimani5472
    29 views1 page
    This document contains an exam for the subject Indian Financial Services. [SECTION A] contains 7 multiple choice questions about various topics in financial services. [SECTION B] presents a case study about a company deciding whether to purchase or lease a machine. It provides financial details about the purchase and leasing options and asks the student to advise which option is better for the company and assess the viability of the leasing option for the lessor. The exam is out of 50 marks and contains short answer and calculation questions.

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    IMT-41

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    This document contains an exam for the subject Indian Financial Services. [SECTION A] contains 7 multiple choice questions about various topics in financial services. [SECTION B] presents a case study about a company deciding whether to purchase or lease a machine. It provides financial details about the purchase and leasing options and asks the student to advise which option is better for the company and assess the viability of the leasing option for the lessor. The exam is out of 50 marks and contains short answer and calculation questions.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    29 views1 page

    Institute of Management Technology: Centre For Distance Learning

    Uploaded by

    abhimani5472
    This document contains an exam for the subject Indian Financial Services. [SECTION A] contains 7 multiple choice questions about various topics in financial services. [SECTION B] presents a case study about a company deciding whether to purchase or lease a machine. It provides financial details about the purchase and leasing options and asks the student to advise which option is better for the company and assess the viability of the leasing option for the lessor. The exam is out of 50 marks and contains short answer and calculation questions.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    INSTITUTE OF MANAGEMENT TECHNOLOGY

    CENTRE FOR DISTANCE LEARNING


    GHAZIABAD
    End-Term Examinations – June 2009
    Subject Code : IMT-41 Time Allowed : 3 Hours
    Subject Name: Indian Financial Services Max. Marks : 50

    Notes: (a) Answer any FOUR questions from SECTION-A and CASE STUDY as given in SECTION-B.
    Each Question (SECTION-A) carries 9 MARKS and (SECTION-B) Case Study carries 14 MARKS.
    (b) No doubts/clarifications shall be entertained. In case of doubts/clarifications, make reasonable assumptions and proceed.
    (c) For students enrolled in January 2008, July 2008 and January 2009 batches, the Question Paper would be treated for
    70 marks instead of 50 marks.

    SECTION-A MARKS : 36

    Q.1 Define the term financial services and explain its role in development of a financial system?
    Q.2 “Discuss the framework of NBFCs under the RBI Guidelines ? what are the prudential norms applicable to NBFCs?
    Q.3 What are the pre and post issue obligations of lead Merchant Banker in respect of fresh issue?
    Q.4 Define Venture capital financing ? what are the main features of venture capital ?
    Q.5 Write short notes on any three of the following:
    (a) Bought out deals
    (b) Commercial paper
    (c) Conglomerate Merger
    (d) Multiple Banking Arrangement
    (e) Open ended and close ended funds
    Q.6 What are the similarities and difference between Lease financing and Debt financing? In what cases lease may be
    preferred?
    Q.7 RSS ltd. is planning to acquires BXY ltd. The position before take over was as under:

    Company RSS Ltd Company BXY Ltd


    No. of Shares Outstanding 100000 50000
    Total Earnings Rs. 50,00,000 Rs. 25,00,000
    Market Price of share Rs 80 Rs 60
    Authorised Capital Rs. 100 Lacs Rs. 50 Lacs

    The shareholders of the company BXY ltd are offered 75 shares of Company RSS for 100 Shares Company BXY ltd.
    You are required to calculate the EPS of the amalgamated company vis-à-vis before take over position, of the two
    companies and gain/loss of the share holders of both the firms consequent to amalgamation.

    SECTION-B (Case Study) MARKS : 14

    Hemant pharma Ltd is in the business of manufacturing bearings. Some more product lines are being planned to be added to
    the existing system. The machinery required may be bought or may be taken on lease. The cost of machine is Rs.40,00,000
    having a useful life of 5 years with the salvage value of Rs.8,00,000. The full purchase value of machine can be financed by 20
    percent loan repayable in five equal installments falling due at the end of each year. Alternatively, the machine can be procured
    on a 5-year lease, year-end lease rentals being Rs.12,00,000 per annum. The company follows the written down value method
    of depreciation at the rate of 25 percent. Its tax rate is 35 percent and cost of capital is 16 percent.

    1. Advise the company which option it should choose lease or borrow.


    2. Assess the proposal from the lessor’s point of view examining whether leasing the machine is financially viable at 14
    percent cost of capital( Detailed working notes should be given.)
    Year 1 2 3 4 5 6
    PV Factor at 13% 0.885 0.783 0.693 0.613 0.543 0.480
    PV Factor at 14% 0.877 0.769 0.675 0.592 0.519 0.456
    PV Factor at 20% 0.833 0.694 0.579 0.482 0.402 0.335

    29-6-2009 (M) Page 1 of 1 IMT-41

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