Statement (I) : A debt-equity ratio of 2 : 1 indicates that for every 1 unit of equity, the company has raised 2 units of debt. Statement (II) : The cost of floating an equity issue is lesser than the cost of floating a debt

Assertion (A) : Invertors in capital market now have higher inclination for investment in debentures. Reasoning (R) : Debentures have active secondary markets now.

(a) Capital markets are perfect (b) Firms belong to equal risk class (c) There is 100% dividend payout ratio (d) There are nominal corporate taxes

(a) a merger (b) an amalgamation (c) a takeover (d) an absorption

Assertion (A) : Risk analysis of capital investment is the most complex and controversial area in finance. Reasoning (R) : Capital investment decisions are based on estimates of future cash inflows.