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26 one focus of national instrument 81 102 which

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26.One focus of National Instrument 81 ´ 102 which covers the use of derivatives bymutual fund managers is to°a)allow the use of derivatives to minimize risk while ensuring thatderivatives arenotused speculatively.b)prevent mutual fund managers from using derivatives to facilitatemarket entry and exit.c)disallow mutual fund managers from using derivatives to create clonefunds.d)ensure that the use of permitted derivatives is clearly set out in thefund±s simplified prospectus.Downloaded by liana anwar ([email protected])lOMoARcPSD|4790996
27.You are examining an industry where profit margins are falling, even as cash flowis negative.At the same time, strong earnings are being reported.You wouldconclude°a)that management is not fully disclosing.b)that this industry is in its emerging stage.c)that this industry is in its growth stage.d)that this industry is in its declining stage.28.You are about to meet a 40-year old prospect for the first time.She has beenemployed for the same company for 12 years and recently made Vice-President.Given that she is in her mid-earning years, it is likely that her investmentobjectives would be°a)safety and growth.b)income and tax minimization.c)growth and income.d)growth and tax minimization.29.A security is currently $25 per share.You think that there is a 50% chance that itwill be unchanged over the course of the next year, and a 50% chance that it willreach $30.Its beta is 1.2, the expected market return is 8%, and the risk-freerate is 5%.According to the CAPM model°a)You shouldnotbuy this security because its expected return of 10% isnot more than 20% greater than the 8% market return.b)You shouldnotbuy this security because its expected return of 10% isnot more than 20% greater than the 8.6% return estimated by theCAPM model.c)You should buy this security its expected return of 10% exceeds the8.0% expected return of the market.d)You should buy this security because its expected return of 10%exceeds the 8.6% required by the CAPM model.30.Refer to Question #29.What is the security±s alpha?a)0.0b)1.4c)2.0d)Insufficient information.31.The most frequently observed reversal pattern in technical analysis is the°a)head-and-shoulders formationb)reverse head-and-shoulders formationc)continuation patternd)oscillator patternDownloaded by liana anwar ([email protected])lOMoARcPSD|4790996
32.Which of the following isnottrue with respect to RESPs?a)Contributions into an RESP plan arenottax-deductible.b)The maximum amount that can be contributed in a single calendaryear for each beneficiary is $4,000.c)Contributors are allowed to transfer a maximum of $50,000 to theirRRSPs if beneficiaries do not attend qualifying school programs.d)There is a lifetime maximum of $100,000 per beneficiary.

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