EFN 406 quiz 9 Semester 2, 2016
Question 2
A Limited has just issued a bond with face value of $1000 and a coupon rate of 8%. If the
bond has a life of 15 years, pays annual coupons and the YTM is 7.5%, what will the bond
sell for?
$1044
$1020
$957
$1051
Finance Quiz 8
Sem 2, 2016
Question 1- The annual nominal rate is j m = 0.12pa. What is the effective annual rate
as a percentage to two decimal places? The number of compounding periods is 6.
Enter your answer as a decimal eg 17.42% = .1742 to four decim
Quiz 3
Question 2
In an efficient market the purchase of financial assets would represent a zero NPV project.
Answer
True (This is the correct answer)
False
Question 3 shares
A non-redeemable preference share is paying a constant dividend of $7. What is t
Question 1
A weak-form efficient market can best be described as a market in which:
Answer
a
.
b
.
c
.
d
.
e
.
all publicly available information is fully reflected in share
prices.
trends in prices can be exploited
trading strategies based on past inform
Question 1
A Limited has just issued a bond with face value of $1000 and a
coupon rate of 8%. If the bond has a life of 15 years, pays annual
coupons and the YTM is 7.5%, what will the bond sell for?
Answer
a $10
. 44
b $95
. 7
c $10
. 51
d $11
. 62
e $10
Question 2
The value of an option in excess of its intrinsic value is known as:
Answer
a current
.
value
b
.
excess
value
c
.
exercise
value
d
.
strike
value
e time
.
value
Question 3
Only buyers of futures are required to put down a deposits, and are mar
Question 1
0 out of 0.5 points
Using discounted payback. A conventional project that has a discount payback
period less than its useful life cannot have a negative NPV.
Selected Answer:
False
Answers:
True
False
Response Feedback: incorrect
Question 2
0.5
Question 1
0 out of 1 points
What is the beta of an asset with an expected return of 16%, if the risk-free rate of
interest is 6% and the expected market portfolio risk premium is 6%? Accurate to
two decimal places.
Selected Answer:
d.
0
Answers:
a.
2
b.
Question 1
0 out of 0 points
This online quiz is an individual assessment. Your answers should be your own work
and should not be the result of work done by others.
Selected
Answer:
I UNDERSTAND and AGREE that this is an individual assessment
and will sub
Question 1
0 out of 0 points
This online quiz is an individual assessment. Your answers
should be your own work and should not be the result of work
done by others.
Selected
Answer:
Answers:
I UNDERSTAND and AGREE that this is an
individual assessment an
Question 1
0.5 out of 0.5 points
In an efficient market the current price is:
Selected Answer:
c.
neither too low nor too high
Answers:
a.
none of the given answers
b.
always higher
c.
neither too low nor too high
d.
the prices do not change
e.
always low
Question 1
1.5 out of 1.5 points
Given the data below, calculate the net present value of an infinite chain of
replacement using the equivalent annual value method. Assume the cost of capital
is 11% p.a.
Initial Outlay Year 1 Year 2 Year 3
-$10,000
$10,00
Question 1
0.5 out of 0.5 points
When using the CAPM to estimate the cost of equity for evaluation of investment
proposals, the appropriate substitute for the risk free rate of interest is:
Selected
Answer:
Answers:
c.
The yield on a government security w
Question 1
0.5 out of 0.5 points
The writer of an option is the:
Selected Answer:
e.
initial seller of the option
Answers:
a.
both buyer of the put option and buyer of the call option
b.
taker of a put option
c.
taker of a call option
d.
owner of the opti
Question 1
1 out of 1 points
Benefit-cost ratio is calculated by:
Selected
Answer:
Answers:
d.
dividing the present value of future net cash flows by the initial
outlay.
a.
dividing the outlay by the present value of future net cash flows.
b.
dividing the
Question
Given the following information calculate the standard deviation of returns of a portfolio
that combines government bonds with the market portfolio.
Rm = .11
Rf = .05
Standard Deviation of market return = 0.11
Enter your answer as a decimal accur
Queensland University of Technology
Faculty of Business
EFN505: FINANCIAL RISK MANAGEMENT
MID EXAM
August 2012
Time Allowed: 100 Minutes (+10 minutes reading).
Total Marks: 50 OUT OF 100
THIS IS A CLOSED BOOK EXAM
Student Surname:
_
Student Other Name(s):
Queensland University of Technology
Faculty of Business
EFN505: FINANCIAL RISK MANAGEMENT
MID EXAM
N.B. THIS IS A SAMPLE COPY ONLY
September 2012
Time Allowed: 2 hours (there is no reading time allocated).
Total Marks: 50 OUT OF 100
THIS IS A CLOSED BOOK