FINA3315 EXAM 2025 QUESTIONS AND
ANSWERS
The government is generally - ANS a demander of funds in the financial market.
Which of the following are advantages of the buy and hold strategy?
I. rapid accumulation of wealth
II. low transaction costs
III. capital gains taxed at the long−term rate
IV. portfolio requires less time and energy to manage than for most other strategies - ANS II,
III and IV only
Commonly used multiples for determining a stock's value include
I. price to earnings.
II. price to sales.
III. price to cash flow.
IV. price to dividends. - ANS I, II and III only
The expected rate of return and standard deviations, respectively for four stocks are given
below:
ABC 9%, 3%
CDE 11%, 9%
FGH 12%, 8%
IJK 14%, 10%
Which stock is clearly least desirable? - ANS CDE
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, American investors have several alternatives available to diversify their portfolios
internationally. In terms of transaction costs, which of the alternatives below is least attractive?
- ANS direct investment in foreign stocks
Which of the following statements about short selling is (are) true?
I. Short selling requires an initial margin deposit.
II. Short sellers begin a transaction with a sale and end it with a purchase.
III. Short sellers profit when the stock prices rises.
IV. Short selling can be a risky strategy. - ANS I, II and IV only
From 1976 through 2014, the dividend yield on stocks has been ________ the coupon yield on
corporate bonds. - ANS consistently lower than
Traditional portfolio managers prefer wellminus−known companies because
I. stocks of wellminus−known firms tend to be less risky than stocks of lesserminus−known
firms.
II. individuals are more apt to purchase a mutual fund if it contains stocks of wellminus−known
firms.
III. window dressing encourages the purchase of wellminus−known stocks.
IV. institutional investors tend to exhibit "herdminus−like" behavior. - ANS I, II , III and IV
The intrinsic value of a stock provides a purchase price for the stock - ANS that is reasonable
given the associated level of risk.
A holding period return is calculated by adding the current income to the capital gains and
dividing this sum by the - ANS beginning investment value.
Exchange traded funds are - ANS baskets of securities that trade like a single stock.
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ANSWERS
The government is generally - ANS a demander of funds in the financial market.
Which of the following are advantages of the buy and hold strategy?
I. rapid accumulation of wealth
II. low transaction costs
III. capital gains taxed at the long−term rate
IV. portfolio requires less time and energy to manage than for most other strategies - ANS II,
III and IV only
Commonly used multiples for determining a stock's value include
I. price to earnings.
II. price to sales.
III. price to cash flow.
IV. price to dividends. - ANS I, II and III only
The expected rate of return and standard deviations, respectively for four stocks are given
below:
ABC 9%, 3%
CDE 11%, 9%
FGH 12%, 8%
IJK 14%, 10%
Which stock is clearly least desirable? - ANS CDE
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 1
, American investors have several alternatives available to diversify their portfolios
internationally. In terms of transaction costs, which of the alternatives below is least attractive?
- ANS direct investment in foreign stocks
Which of the following statements about short selling is (are) true?
I. Short selling requires an initial margin deposit.
II. Short sellers begin a transaction with a sale and end it with a purchase.
III. Short sellers profit when the stock prices rises.
IV. Short selling can be a risky strategy. - ANS I, II and IV only
From 1976 through 2014, the dividend yield on stocks has been ________ the coupon yield on
corporate bonds. - ANS consistently lower than
Traditional portfolio managers prefer wellminus−known companies because
I. stocks of wellminus−known firms tend to be less risky than stocks of lesserminus−known
firms.
II. individuals are more apt to purchase a mutual fund if it contains stocks of wellminus−known
firms.
III. window dressing encourages the purchase of wellminus−known stocks.
IV. institutional investors tend to exhibit "herdminus−like" behavior. - ANS I, II , III and IV
The intrinsic value of a stock provides a purchase price for the stock - ANS that is reasonable
given the associated level of risk.
A holding period return is calculated by adding the current income to the capital gains and
dividing this sum by the - ANS beginning investment value.
Exchange traded funds are - ANS baskets of securities that trade like a single stock.
COPYRIGHT © 2025 FYNDLAY ALL RIGHTS RESERVED 2
