FINA 3315 UPDATED ACTUAL Exam
Questions and CORRECT Answers
Investors who seek, double (federal and state) tax -free income should invest in _______ bond
funds. - CORRECT ANSWER - Single- State Municipal
When the stock market has bottomed out and is beginning to recover, the best portfolio to own is
the one with a beta of - CORRECT ANSWER - +2.0
Which of the following are specifically state in futures contracts
I. The quality of the commodity to be delivered
II. The quality of the commodity to be delivered
III. the exact price at which the commodity must be delivered
IV. the time and place at which the commodity must be delivered - CORRECT ANSWER -
II,III, IV Only
Which of the following tend to raise interest rates?
I. An increase in the expected rate of inflation
II. An increase in the expected rate of inflation
III. federal reserve action taken to lower expected rates of inflation
IV. An increase in investing activities by businesses - CORRECT ANSWER - II,III,IV
only
Which of the following signals that a market top or bottom is near? - CORRECT
ANSWER - The relative strength index
In commodities trading, open interest at the end of a trading day is equal to - CORRECT
ANSWER - The number of contracts presently outstanding
The returns on the stock of Def and GHI companies over a 4 year period are shown below.
, Year DEF GHI
1 8% 11%
2 12% 9%
3 -5% -9%
4 6% 13% - CORRECT ANSWER - DEF and GHI are somewhat positively correlated
An inverted yield curve - CORRECT ANSWER - Sometimes results from actions by the
Federal Reserve to control inflation
A holding period return is calculated by adding the current income to the capital gains and
dividing this sum by the _______ - CORRECT ANSWER - Beginning investment value
Stock quotes on the most internet service providers such as Yahoo Finance include
I. The highest and lowest price over the last 52 week
II. The closing price for the previous trading day
III. The opening price for the day
IV. Date of the most recent stock split - CORRECT ANSWER - I,II,III Only
Which of the following statements concerning mortgage backed securities are correct?
I. They are secured by a pool of residential mortgages
II. A portion of the income stream is a non-taxable return of capital
III. They are backed by the full faith and credit of the U.S. government
VI. Their maturity depends on prepayments of the mortgages in the pool - CORRECT
ANSWER - I,II, IV Only
Traditional portfolio managers prefer well know companies because
I. Stock of well - known firms tend to be less risky than stocks of lesser - known firms
II. Individuals are more apt to purchase a mutual fund if it contains stocks of well - known firm
III. Window dressing encourages the purchase of well - know stocks
Questions and CORRECT Answers
Investors who seek, double (federal and state) tax -free income should invest in _______ bond
funds. - CORRECT ANSWER - Single- State Municipal
When the stock market has bottomed out and is beginning to recover, the best portfolio to own is
the one with a beta of - CORRECT ANSWER - +2.0
Which of the following are specifically state in futures contracts
I. The quality of the commodity to be delivered
II. The quality of the commodity to be delivered
III. the exact price at which the commodity must be delivered
IV. the time and place at which the commodity must be delivered - CORRECT ANSWER -
II,III, IV Only
Which of the following tend to raise interest rates?
I. An increase in the expected rate of inflation
II. An increase in the expected rate of inflation
III. federal reserve action taken to lower expected rates of inflation
IV. An increase in investing activities by businesses - CORRECT ANSWER - II,III,IV
only
Which of the following signals that a market top or bottom is near? - CORRECT
ANSWER - The relative strength index
In commodities trading, open interest at the end of a trading day is equal to - CORRECT
ANSWER - The number of contracts presently outstanding
The returns on the stock of Def and GHI companies over a 4 year period are shown below.
, Year DEF GHI
1 8% 11%
2 12% 9%
3 -5% -9%
4 6% 13% - CORRECT ANSWER - DEF and GHI are somewhat positively correlated
An inverted yield curve - CORRECT ANSWER - Sometimes results from actions by the
Federal Reserve to control inflation
A holding period return is calculated by adding the current income to the capital gains and
dividing this sum by the _______ - CORRECT ANSWER - Beginning investment value
Stock quotes on the most internet service providers such as Yahoo Finance include
I. The highest and lowest price over the last 52 week
II. The closing price for the previous trading day
III. The opening price for the day
IV. Date of the most recent stock split - CORRECT ANSWER - I,II,III Only
Which of the following statements concerning mortgage backed securities are correct?
I. They are secured by a pool of residential mortgages
II. A portion of the income stream is a non-taxable return of capital
III. They are backed by the full faith and credit of the U.S. government
VI. Their maturity depends on prepayments of the mortgages in the pool - CORRECT
ANSWER - I,II, IV Only
Traditional portfolio managers prefer well know companies because
I. Stock of well - known firms tend to be less risky than stocks of lesser - known firms
II. Individuals are more apt to purchase a mutual fund if it contains stocks of well - known firm
III. Window dressing encourages the purchase of well - know stocks
