Fina 3315 Final ACTUAL Exam Questions
and CORRECT Answers
If the present value of an investment's benefits equals the present value of the investment's costs,
then the investor would earn a - CORRECT ANSWER - return equal to the discount rate.
American investors can participate in international stock markets by - CORRECT
ANSWER - all of the above.
The purchaser of a futures contract - CORRECT ANSWER - is affected by the daily
procedure known as
mark−to−the−market.
Which of the following is not traded in the securities markets? - CORRECT ANSWER -
real estate
The transaction costs of investing directly in
foreign−currency−denominated
assets can be reduced by purchasing American Depositary Shares (ADSs). - CORRECT
ANSWER - true
Historically higher returns on the stocks of small companies can be completely explained by
their higher risk. - CORRECT ANSWER - false
Consider the following statements about a futures clearinghouse:
Statement 1: "A clearinghouse in futures contracts allows for the offsetting of contracts prior to
delivery."
Statement 2: "A clearing house in futures contracts collects initial margin (performance bonds)
from both the long and short sides in the contract."
Are the statements most likely correct or incorrect? - CORRECT ANSWER - Both
statements are correct.
, Which of the following will affect the firm's future cash flows?
I. state of the economy
II. state of the industry
III. the firm's recent and current earnings
IV. new products in the firm's pipeline - CORRECT ANSWER - I, II and IV only
The index used to represent market returns is always assigned a beta of 1.0. - CORRECT
ANSWER - True
One of the calendar effect market anomalies indicates that ________ in value during January. -
CORRECT ANSWER - small cap stocks tend to increase
As bonds approach their maturity dates - CORRECT ANSWER - prices will approach
their par values.
The commission charged when shares of an
open−end
mutual fund are purchased is called a - CORRECT ANSWER - front−end
load.
A convenient way for small investors to enjoy the benefits of a broadly diversified portfolio is by
purchasing: - CORRECT ANSWER - mutual fund shares.
When a company offers the investing public a certain number of shares of its stock at a certain
price, the company is making what is known as a - CORRECT ANSWER - public
offering.
The behavioral tendency known as loss aversion causes some investors to: - CORRECT
ANSWER - hold losing stocks longer than winning stocks.
and CORRECT Answers
If the present value of an investment's benefits equals the present value of the investment's costs,
then the investor would earn a - CORRECT ANSWER - return equal to the discount rate.
American investors can participate in international stock markets by - CORRECT
ANSWER - all of the above.
The purchaser of a futures contract - CORRECT ANSWER - is affected by the daily
procedure known as
mark−to−the−market.
Which of the following is not traded in the securities markets? - CORRECT ANSWER -
real estate
The transaction costs of investing directly in
foreign−currency−denominated
assets can be reduced by purchasing American Depositary Shares (ADSs). - CORRECT
ANSWER - true
Historically higher returns on the stocks of small companies can be completely explained by
their higher risk. - CORRECT ANSWER - false
Consider the following statements about a futures clearinghouse:
Statement 1: "A clearinghouse in futures contracts allows for the offsetting of contracts prior to
delivery."
Statement 2: "A clearing house in futures contracts collects initial margin (performance bonds)
from both the long and short sides in the contract."
Are the statements most likely correct or incorrect? - CORRECT ANSWER - Both
statements are correct.
, Which of the following will affect the firm's future cash flows?
I. state of the economy
II. state of the industry
III. the firm's recent and current earnings
IV. new products in the firm's pipeline - CORRECT ANSWER - I, II and IV only
The index used to represent market returns is always assigned a beta of 1.0. - CORRECT
ANSWER - True
One of the calendar effect market anomalies indicates that ________ in value during January. -
CORRECT ANSWER - small cap stocks tend to increase
As bonds approach their maturity dates - CORRECT ANSWER - prices will approach
their par values.
The commission charged when shares of an
open−end
mutual fund are purchased is called a - CORRECT ANSWER - front−end
load.
A convenient way for small investors to enjoy the benefits of a broadly diversified portfolio is by
purchasing: - CORRECT ANSWER - mutual fund shares.
When a company offers the investing public a certain number of shares of its stock at a certain
price, the company is making what is known as a - CORRECT ANSWER - public
offering.
The behavioral tendency known as loss aversion causes some investors to: - CORRECT
ANSWER - hold losing stocks longer than winning stocks.
