BNAD 301 Exam Review with Questions and Answers

BNAD 301 Exam Review with Questions and Answers If the yield on a bond is 4%, and the expected inflation rate is 1%, then the bond earns a real interest rate of: (A) -3%. (D) 3% (B) 1% (E) 4% (C) 2% (AB) 5%. ANSWER D Which asset's market price can be explained only as a blend of intrinsic and extrinsic value? (A) Gold. (B) Dollars. (C) Bitcoin. (D) Shares of IBM. ANSWER A Which interest rates tend to fluctuate more (i.e., show more up and down variation)? (A) Real rates (B) Nominal rates. (C) They fluctuate to an approximately equal extent. ANSWER B According to the theory of efficient financial markets, an investment manager who has historically outperformed the market index for stocks of similar risk is most likely to ______ that index in the future. (A) underperform (B) continue to outperform (C) match (neither underperform nor outperform) ANSWER C