Fin4502_Review1(Ch1,2,3,5-7)

Fin4502_Review1(Ch1,2,3,5-7) - Fin4502_Review1 Student: _...

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Fin4502_Review1 Student: ___________________________________________________________________________ 1. __________ portfolio construction starts with selecting attractively priced securities. A . Bottom-up B. Top-down C. Upside-down D. none of the above 2. __________ financial assets. A. Buildings are B. Lands are C. Machines are D. None of the above are 3. Fixed-income securities promise __________. A. a fixed stream of income B. a stream of income that is determined according to a specific formula C. either a or b D. neither a nor b 4. The efficient markets hypothesis suggests that ________ A. active portfolio management strategies are most appropriate B . passive portfolio management strategies are most appropriate C. either active or passive strategies may be appropriate, depending on the direction of the market. D. the Peter Lynch (former manager of Fidelity's Magellan Fund) portfolio management strategy is most appropriate.
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5. The most important feature of municipal bonds is their _______. A. safety B. liquidity C . tax-exempt status D. convertibility 6. __________ is not a money market instrument. A. A certificate of deposit B. A treasury bill C . A treasury bond D. Commercial paper 7. The Dow Jones Industrial Average is computed by __________. A. adding the prices of 30 large "blue-chip" stocks and dividing by 30 B. calculating the total market value of the 30 firms in the index and dividing by 30 C. adding the prices of the 30 stocks in the index and dividing by a divisor D. adding the prices of the 500 stocks in the index and dividing by a divisor 8. __________ market-value weighted. A. The New York Stock Exchange Composite index is B. C. The Wilshire 5000 index is D. All of the above are 9. If a treasury note has a bid price of $982.50, the quoted bid price in the Wall Street Journal would be __________. A . $98:08 B. $98:25 C. $98:50 D. $98:40
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28% tax bracket this bond would provide you with an equivalent taxable yield of __________ A. 5.76% B. 9.2% C. 11.1% D. None of the above 11. The purchase price for a bond is listed as 104 and the annual coupon rate is 4.3%. What is the current yield on this bond? A. 0.00% B. 4.00% C. 4.13% D. 4.30% 12. The Hydro Index is a price weighted stock index based on the 5 largest boat manufacturers in the nation. The stock prices for the give stocks are $15, $21, $65, $55 and $41. What is the price weighted index value of the Hydro Index. A. 28.90 B. 39.40 C. 41.23 D. 45.65 13. Underwriting is one of the services provided by ____. A. the SEC B. investment bankers C. publicly traded companies D. FDIC 14. Initial margin requirements on stocks are set by __________. A. the Federal Deposit Insurance Corporation
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Fin4502_Review1(Ch1,2,3,5-7) - Fin4502_Review1 Student: _...

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