Hw1sol - Investment Analysis(FIN 383 Fall 2010 Homework 1 Instructions please read carefully You should show your work how to get the answer for

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Investment Analysis (FIN 383) Fall 2010 Homework 1 Instructions: please read carefully You should show your work how to get the answer for each calculation question to get full credit. The due date is Tue, Feb 9, 2010. Late homework will not be graded. Name(s): Student ID
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Chapter 1 1. There would be no _______________ in an efficient stock market. a. underpriced or overpriced stocks b. returns higher than 100% c. commission costs d. taxes 1. a 2. A _______________ represents an ownership share in a corporation. a. bond b. preferred stock c. common stock d. All of the above. e. B and C 2. e 3. In securities markets, the risk-return trade-off implies that assets with higher risk will offer investors _______________ expected returns. a. higher b. lower c. the same d. None of the above. 3. a 4. Allocation of the investment portfolio across broad asset classes refers to the _______________. a. security analysis b. top-down portfolio construction c. asset allocation d. None of the above. 4. c 5. American Depository Receipts are claims to _______________. a. foreign stocks b. American stocks c. North American stocks d. European stocks 5. a 6. Firms that specialize in helping companies raise capital by selling securities are called _______________. a. industrial banks b. commercial banks c. investment banks d. None of the above. 6. c
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_______________ are financial assets. a. Options b. Factories c. Commercial properties d. All of the above are financial assets. 7. a 8. Portfolio manager with a passive investment strategy will manage a portfolio by ______________. a. holding a diversified portfolio b. selecting mispriced securities c. timing the performance of securities d. None of the above. 8. a 9. Corporate bonds are _______________ securities. a. fixed-income b. money-market c. derivatives d. real 9. a Chapter 2 10. Commercial papers are short-term debt issued by _______________ companies a. large and well-known b. small and well-known c. financial d. commercial 10. a 11. Preferred stock dividends are _______________. a. tax exempted b. cumulative c. non-cumulative d. risk free 11. b 12. The price which the owner of a put option will receive from selling the stock named in the option contract is called the _______________. a.
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This note was uploaded on 10/20/2010 for the course FIN FIN383 taught by Professor Duongnguyen during the Spring '09 term at UMass Dartmouth.

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Hw1sol - Investment Analysis(FIN 383 Fall 2010 Homework 1 Instructions please read carefully You should show your work how to get the answer for

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