FNAN522-1SP11-Final_Answer_Key

FNAN522-1SP11-Final_Answer_Key - ANSWER KEY Final Exam...

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1 ANSWER KEY Final Exam Advanced Financial Management and Policy FNAN522-1SP11 Moody Hall, Room 125 Thursday, May 5, 2011 3:00 P.M. to 5:30 P.M. 80 Points Total 150 Minutes 16 Questions All questions are worth 5 points. Please read the following instructions first: DO NOT TURN OVER THIS PAGE UNTIL YOU ARE INSTRUCTED TO DO SO. Write your name, the date, and the subject on the bubble sheet. Only answers that are clearly recorded on the bubble sheet will counted towards you mark. There is only one correct answer per question. You may only give one answer per question. It is strongly recommended that you bubble your responses clearly in pencil. This will allow you to erase answers if you change your mind. Nevertheless, unclear or multiple marks on a single question will result in no points. No credit will be given for scrap work. Partial credit will NOT be given. Hand in your bubble sheet to the instructor when you are finished. You will NOT be allowed back into the test room once you leave.
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2 Multiple Choice Questions Instructions: To answer these questions, bubble in the letter that corresponds with the best answer for each question on you answer key. 1. A put option gives the owner the right: A. and the obligation to buy an asset at a given price B. and the obligation to sell an asset at a given price C. but not the obligation to buy an asset at a given price D. but not the obligation to sell an asset at a given price p. 505 2. The buyer of a call option has the right to exercise, but the writer of the call option has: A. The choice to offset with a put option B. The obligation to deliver the shares at exercise price C. The choice to deliver shares or take a cash payoff D. The choice of exercising the call or not p. 505 3. The figure below depicts the: A. profit diagram for the buyer of a call option B. profit diagram for the writer (seller) of a call option C. profit diagram for the buyer of a put option D. profit diagram for the writer (seller) of a put option p. 507
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FNAN522-1SP11-Final_Answer_Key - ANSWER KEY Final Exam...

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