Oldexam1 - Some questions from old exams. Exam I...

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Some questions from old exams. Exam I Multiple-choice questions. 1. Firms that specialize in helping companies raise capital by selling securities are called ________. A) commercial banks B) investment banks C) savings banks D) credit unions E) all of the above. Ans: B 2. The sale of a mortgage portfolio by setting up mortgage pass-through securities is an example of ________. A) credit enhancement B) securitization C) unbundling D) derivatives E) none of the above Ans: B 3. The Dow Jones Industrial Average (DJIA) 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. E) adding the prices of the 30 stocks in the index and dividing by the value of these stocks as of some base date period. Ans: C 4. In order for you to be indifferent between the after tax returns on a corporate bond paying 8.5% and a tax-exempt municipal bond paying 6.12%, what would your tax bracket need to be?
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A) 33% B) 72% C) 15% D) 28% E) Cannot tell from the information given Ans: D 5. Investment bankers A) act as intermediaries between issuers of stocks and investors. B)
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Oldexam1 - Some questions from old exams. Exam I...

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