Questions for chapters 1 & 2 :
Q1/ A bond issued by the state of Alabama is priced to yield 6.45%. If you are in the 20% tax bracket, this bond
would provide you with an equivalent taxable yield of _.
Q2/ Consider the three stocks in the following table. Pt represents price at time t, and Qt represents
shares outstanding at time t. Stock C splits two-for-one in the last period.
P0 Q0 P1 Q1 P2. Q2
91 100 96 100 96 100
51 200 46 200 46 200
102 200 112 200 56 400
A : market value-weighted?
B : equally weighted?
Q3/ One of the purpose of derivatives markets is that it transfers risk from one party to another.
The ANSWER is D.
Q4/ Which one of the following is the government agency which regulates the financial markets in the Saudi
Arabia?
Finance Ministry
Tadawul
Saudi Arabian Monetary Authority
Capital Market Authority
I guess Tadawul is the right ANSWER.
Q1/ A bond issued by the state of Alabama is priced to yield 6.45%. If you are in the 20% tax bracket, this bond
would provide you with an equivalent taxable yield of _.
Q2/ Consider the three stocks in the following table. Pt represents price at time t, and Qt represents
shares outstanding at time t. Stock C splits two-for-one in the last period.
P0 Q0 P1 Q1 P2. Q2
91 100 96 100 96 100
51 200 46 200 46 200
102 200 112 200 56 400
A : market value-weighted?
B : equally weighted?
Q3/ One of the purpose of derivatives markets is that it transfers risk from one party to another.
The ANSWER is D.
Q4/ Which one of the following is the government agency which regulates the financial markets in the Saudi
Arabia?
Finance Ministry
Tadawul
Saudi Arabian Monetary Authority
Capital Market Authority
I guess Tadawul is the right ANSWER.
