CHAPTER 9 CONCEPTUAL QUESTIONS, CHAPTER
10 CONCEPTUAL QUESTIONS, FINANCE 3000 EXAM
3
1. This includes any capital gain (or loss) that occurred as well as any income that
you received from a specific investment.
A. average return
B. dollar return
C. market return
D. portfolio
Answer B
2. This is the dollar return characterized as a percentage of money invested.
A. average return
B. dollar return
C. market return
D. percentage return
, Answer D
3. This is a measure summarizing the overall past performance of an invest- ment.
A. average return
B. dollar return
C. market return
D. percentage return
Answer A
4. Which of these statements is true?
A. When people purchase a stock, they know exactly what their dollar and
percent return are going to be.
B. Many people purchase stocks as they find comfort in the certainty for this safe
form of investing.
C. When people purchase a stock, they know the short-term return, but not the long
term return.
D. When people purchase a stock, they do not know what their return is going to be
,- either short term or in the long run.
Answer D
5. This is defined as the volatility of an investment, which includes firm specific risk
as well as market risk.
A. diversifiable risk
B. market risk
, C. standard deviation
D. total risk
Answer D
6. This is a measure of risk to reward earned by an investment over a specific
period of time.
A. coefficient of variation
B. market deviation
C. standard deviation
D. total variation
Answer A
7. This index tracks 500 companies which allows for a great deal of diversifica- tion.
A. Nasdaq
B. Fortune 500
C. S&P 500
10 CONCEPTUAL QUESTIONS, FINANCE 3000 EXAM
3
1. This includes any capital gain (or loss) that occurred as well as any income that
you received from a specific investment.
A. average return
B. dollar return
C. market return
D. portfolio
Answer B
2. This is the dollar return characterized as a percentage of money invested.
A. average return
B. dollar return
C. market return
D. percentage return
, Answer D
3. This is a measure summarizing the overall past performance of an invest- ment.
A. average return
B. dollar return
C. market return
D. percentage return
Answer A
4. Which of these statements is true?
A. When people purchase a stock, they know exactly what their dollar and
percent return are going to be.
B. Many people purchase stocks as they find comfort in the certainty for this safe
form of investing.
C. When people purchase a stock, they know the short-term return, but not the long
term return.
D. When people purchase a stock, they do not know what their return is going to be
,- either short term or in the long run.
Answer D
5. This is defined as the volatility of an investment, which includes firm specific risk
as well as market risk.
A. diversifiable risk
B. market risk
, C. standard deviation
D. total risk
Answer D
6. This is a measure of risk to reward earned by an investment over a specific
period of time.
A. coefficient of variation
B. market deviation
C. standard deviation
D. total variation
Answer A
7. This index tracks 500 companies which allows for a great deal of diversifica- tion.
A. Nasdaq
B. Fortune 500
C. S&P 500
