Free CIMA CIMAPRO19-F03-1-ENG Exam Questions
Absolute Free CIMAPRO19-F03-1-ENG Exam Practice for Comprehensive Preparation
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CIMA CIMAPRO19-F03-1-ENG Exam Questions
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Provided By: CIMA
- Exam: F3 Financial Strategy
- Certification: CIMA Professional Qualification
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Total Questions: 305
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Updated On: Nov 25, 2025
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Rated: 4.9 |
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Online Users: 610
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Question 1
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A company is funded by:• $40 million of debt (market value)• $60 million of equity (market value)The company plans to:• Issue a bond and use the funds raised to buy back shares at their current market value.• Structure the deal so that the market value of debt becomes equal to the market value of equity.According to Modigliani and Miller's theory with tax and assuming a corporate income tax rate of 20%, thisplan would:
Answer: C
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Question 2
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The Treasurer of Z intends to use interest rate options to set an interest rate cap on Z’s borrowings.
Which of the following statement is correct?
Answer: C
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The Treasurer of Z intends to use interest rate options to set an interest rate cap on Z’s borrowings.
Which of the following statement is correct?
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Question 3
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A company has:• 10 million $1 ordinary shares in issue• A current share price of $5.00 a share• A WACC of 15%The company holds $10 million in cash. No interest is earned on this cash.It will invest this in a project with an expected NPV of $4 million.In a semi-strong efficient stock market, which of the following is the most likely share price immediately afterthe announcement of the new investment?
Answer: A
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Question 4
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Z wishes to borrow at a floating rate and has been told that it can use swaps to reduce the effective interest rateit pays. Z can borrow floating at Libor ' 1, and fixed at 10%.Which of the following companies would be the most appropriate for Z to enter into a swap with?
Answer: C
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Question 5
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A company has a covenant on its 5% long term corporate bond.• Covenant - The earnings must not fall below $7 millionThe bond has a nominal value of $60 million.It is currently trading at 80% of its nominal value.The projected earnings before interest and taxation for next year are $11.5 million.The company retains 80% of its earnings. It pays tax at 20%.Advise the Board of Directors which of the following covenant conditions will apply next year?
Answer: C
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