Scribd
Upload
2 views4 pages

ACF - BỘ TN 9

The document contains a series of finance-related multiple-choice questions and answers, covering topics such as portfolio risk, liquidity preference theory, the term structure of interest rates, options pricing, and market efficiency. Each question is followed by the correct answer, providing a comprehensive overview of key financial concepts. The content serves as a study guide for individuals preparing for finance examinations or seeking to reinforce their understanding of these topics.

Uploaded by

dangminhtri2389
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
2 views4 pages

ACF - BỘ TN 9

The document contains a series of finance-related multiple-choice questions and answers, covering topics such as portfolio risk, liquidity preference theory, the term structure of interest rates, options pricing, and market efficiency. Each question is followed by the correct answer, providing a comprehensive overview of key financial concepts. The content serves as a study guide for individuals preparing for finance examinations or seeking to reinforce their understanding of these topics.

Uploaded by

dangminhtri2389
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 4

1.

​ Portfolio risk can be reduced most by:​


A. Diversification across unrelated assets​
B. Holding a single asset longer​
C. Trading more frequently​
D. Investing only in bonds​

2.​ Liquidity preference theory suggests that:​


A. Long-term bonds must offer higher yields to induce investors​
B. Short-term and long-term rates are always equal​
C. Bonds have no term premium​
D. Forward rates are always correct forecasts​

3.​ The term structure of interest rates is also known as:​


A. The yield curve​
B. The equity curve​
C. The inflation curve​
D. The market line​

4.​ The maximum value of a put option (European) is its:​


A. Strike price (if zero stock price)​
B. Current stock price​
C. Strike minus PV(dividend)​
D. Square root of variance​

5.​ A company issues equity at current market price. This generally signals to the
market that:​
A. Managers believe the stock may be overvalued​
B. The company is undervalued​
C. Nothing changes fundamentally​
D. The market will adjust quickly​

6.​ According to CAPM, if an asset’s beta is 2 and market risk premium is 5%, and
rf = 3%, the required return =​
A. 3% + 2×5% = 13%​
B. 3% + 5% = 8%​
C. 3% + (5%)/2 = 5.5%​
D. 3% + 2% = 5%​

7.​ In a rights offering, if shareholder does nothing, his percentage ownership:​


A. Is diluted (decreases)​
B. Remains unchanged​
C. Increases if new shares are unsold​
D. Becomes zero​

8.​ If markets are strong-form efficient, then studying public filings will:​
A. Provide no abnormal return​
B. Yield huge arbitrage profits​
C. Guarantee positive returns​
D. Only help technical analysts​

9.​ In CAPM, when market risk premium is 7% and beta = 0, expected return =​
A. Risk-free rate​
B. 7%​
C. 0%​
D. Beta × 7%​

10.​Portfolio insurance and hedging strategies assume:​


A. Markets can decline without warning​
B. Markets always go up in the long run​
C. Arbitrage opportunities are constant​
D. Bonds and stocks move in sync​

11.​A long position in a put option profits when:​


A. The underlying stock price falls below the strike​
B. The underlying stock price rises above the strike​
C. Volatility decreases​
D. Interest rates climb​

12.​In an efficient market, common stock prices should follow a:​


A. Random walk (unpredictable changes)​
B. Deterministic pattern​
C. Consistent growth trend​
D. Periodic cycle​

13.​Zero-coupon bond is initially sold at a __ and has a yield to maturity ____.​


A. Discount; reflecting its deep discount​
B. Premium; reflecting inflation​
C. Par; always zero yield​
D. Discount; but always zero yield​

14.​Which stock is an example of a free cash flow perpetuity?​


A. Preferred stock with fixed dividends​
B. Common stock with no dividends​
C. Convertible bond​
D. Warrant​

15.​In a world without taxes, Modigliani-Miller suggests that:​


A. Capital structure is irrelevant to firm value​
B. Debt is always cheaper​
C. Equity carries no risk​
D. Bankruptcy is impossible​

16.​If a stock has beta > 1, it means:​


A. It’s more sensitive to market moves than average​
B. It’s safer than the average market​
C. It has no market risk​
D. It’s risk-free​

17.​The present value of a perpetuity paying $100 forever at a 5% discount rate is:​
A. $2000​
B. $100​
C. $5000​
D. $95​

18.​Assume stock price is random (50% chance up 10%, 50% down 10%). An
efficient market implies:​
A. The best forecast tomorrow’s price is today’s price​
B. You can predict tomorrow by trend analysis​
C. Random outcomes can be arbitraged away​
D. The stock will oscillate predictably​

19.​Standard deviation vs variance:​


A. Standard deviation is the square root of variance​
B. Variance is the derivative of standard deviation​
C. They are always equal​
D. Standard deviation is always smaller than variance​

20.​A bond’s yield to maturity falls if:​


A. Its price rises​
B. Its price falls​
C. It becomes callable​
D. It increases coupon rate​

Answer Key:
1.​ A​

2.​ A​

3.​ A​

4.​ A​

5.​ A​

6.​ A​

7.​ A​

8.​ A​

9.​ A​

10.​A​

11.​A​

12.​A​

13.​A​

14.​A​

15.​A​

16.​A​

17.​A​

18.​A​

19.​A​

20.​A

You might also like