1
Financial Economics 4751
University of Minnesota
Nick Guo
Fall 2009
Practice Midterm Exam
There are 8 questions in this midterm. Show all your work and label the graph carefully.
1. (5
’
) According to data, in 2007, what was the most significant real asset of U.S.
households in terms of total value? What was the most significant liability of U.S.
households in terms of total value? What was the most significant real asset of U.S.
nonfinancial businesses in terms of total value? What was the most significant liability of
U.S. nonfinancial businesses? What was the most significant financial asset of U.S.
nonfinancial businesses in terms of total value?
2.
(10’)
Consider the following three stocks:
A) What’s the
priceweighted index constructed with the three stocks?
B)
What’s
the valueweighted index constructed with the three stocks using a divisor of
100?
C) Assume at these prices the valueweighted index constructed with the three stocks is 49.
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 Spring '11
 none
 Economics, Standard Deviation, U.S. nonfinancial businesses

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