Which of the following are characteristics of a hedge fund?
I. Pooling of assets
II. Strict regulatory oversight by the SEC
III. Investing in equities, debt instruments, and derivative instruments
IV. Professional management of assets
All other things equal (YTM = 10%), which of the following has the longest duration?
A. A 30-year bond with a 10% coupon
B. A 20-year bond with a 9% coupon
C. A 20-year bond with a 7% coupon
D. A 10-year zero-coupon bond
All other th
A mutual fund with a beta of 1.1 has outperformed the S&P 500 over the last 20 years. We know that this
mutual fund manager _.
A. must have had superior stock selection ability.
B. must have had superior asset allocation ability.
In 2011, U.S. securities represented _ of the world market for equities.
A. less than 25%
B. more than two-thirds
C. between 30% and 40%
D. a consistent 50%
_ has the highest market capitalization of listed corporations among develop
Which of the following assets is most liquid?
A. Cash equivalents
D. Plant and equipment
Cost of goods sold refers to _.
A. direct costs attributable to producing the product sold by the firm
The accounting measure of a firm's equity value generated by applying accounting principles to asset and
liability acquisitions is called _.
A. book value
B. market value
C. liquidation value
D. Tobin's q
The price-to-sales ratio is
Today's futures markets are dominated by trading in _ contracts.
A person with a long position in a commodity futures contract wants the price of the commodity to
A. decrease subs
A top-down analysis of a firm's prospects starts with an analysis of the _.
A. firm's position in its industry
B. U.S. economy or even the global economy
D. specific firm under consideration
In 1980 the dollar-yen exchang
To _ means to mitigate a financial risk.
In a defined benefit pension plan, the _ bears all of the fund's investment performance risk.
C. fund manager
A wave is defined as a disturbance which is travelled through a particular medium.
In the previous experiment, weve determined the nature, characteristics, and important
features of a transverse waves and the examples of it that occurs in our rea
Derived from the Latin word calor (meaning heat), and the Greek term metry
(to measure), Calorimetry is the science of measuring the amount of heat. This means
that all calorimetric techniques are therefore based on the measurement of heat that
All matters, with the exception of water experience a change in its dimension in
response to the change in their temperatures. Materials in general, expand when their
temperatures increase and shrink as their temperatures decrease. There are thre
An electric field exerts a force on other electrically charged objects and is defined
as the electric force per unit charge. It is a region where electrostatic force is present and
can be represented by electric field lines which are sometimes ca
We live in a modern world where almost everything is run by electricity. Electricity
is governed by the three fundamental components: resistance, current, and voltage.
They are always part of simple circuits. A series circuit is one in which the
Waves are important in the modern world. To see how important it is, just consider
the music industry. Every piece of music you hear, from some retro punk band playing in
a campus drive to the most eloquent concerto playing on the web, depends on
, , , , _ HME ,
Modute 4; Credit Risk Anaiysis and interpretatSOn -
1‘ Many companies have cyclical operating cash needs due to:
Mergers and acquisitions
he seasonality of sales
Delays in customer payments
D) Refinancing of debt
Modems: _ _
, . ~
? 1. Accounts receivables (net) reported in the current asset section of a company’s balance sheet
represents the total amount owed by customers within the next year.
'5’? 2. in order to report accounts receivable, net, companies e
Solutions to Practice Problems for Test 3
Calculate the arithmetic average = 9% and the
standard deviation = 13.23%. Now figure out
how many standard deviations away from the
mean -17.5% and 35.5% are. Youll see that by
subtracting 2 standard deviation