Mgt201 Fall 2011 Final Term Feb 2012 – VU Current Paper – 08 Feb 2012

Why do firms need to invest in net working capital? 3
What are the advantages and disadvantages of raising capital through equity financing?5
What problems a firm can face if it faces a shortfall or surplus of inventories.3
Compare aggressive working capital financing with conservative
working capital financing.?5
How working capital affects performance of business ? (5 Marks)
Compare the effects of financial leverage and operational leverage on ROE (5 Marks)