Investments 10th Canadian Edition By Zvi Bodie, Alex Kane, Alan Marcus, Lorne
Switzer, Maureen Stapleton, Dana Boyko, Christine Panasian (Test Bank All
Chapters, 100% Original Verified, A+ Grade) Answers At The End Of Each Chapter
Chapter 1:__________
1) The material wealth of a society is a function of
A) all financial assets.
B) all real assets.
C) all financial and real assets.
D) all physical assets.
2) ______ are real assets.
A) Land
B) Machines
C) Stocks and bonds
D) Knowledge
E) Land, machines, and knowledge
3) The means by which individuals hold their claims on real assets in a well-developed
economy are
A) investment assets.
B) depository assets.
C) derivative assets.
D) financial assets.
E) exchange-driven assets.
4) ______ are financial assets.
A) Bonds
B) Machines
C) Stocks
D) Bonds and stocks
E) Bonds, machines, and stocks
. 1
,5) ______ financial asset(s).
A) Buildings are
B) Land is a
C) Derivatives are
D) Canadian T-Bills are
E) Derivatives and Canadian bonds are
6) Financial assets
A) directly contribute to the country's productive capacity.
B) indirectly contribute to the country's productive capacity.
C) contribute to the country's productive capacity, both directly and indirectly.
D) do not contribute to the country's productive capacity, either directly or indirectly.
E) are of no value to anyone.
7) A security that pays a specified cash flow over a specific period is called
A) fixed income.
B) stock option.
C) mutual fund.
D) real estate.
E) index.
8) ______ is a commodity.
A) Money
B) Forward contract
C) Natural gas
D) A bond
E) Treasury-bill
9) Compared to investments in debt securities, equity investments tend to be
A) equally risky.
B) riskier.
C) less risky.
D) more important.
. 2
,10) Which one of the following is not a role of the financial markets?
A) Consumption timing
B) Information
C) Separation of ownership and control
D) Increasing wealth of the economy
E) Risk allocation
11) Holding highly diversified portfolios without spending effort or other resources attempting to
improve investment performance through security analysis is a characteristic of
A) Active management.
B) Passive management.
C) Both active and passive management.
D) Risk-return trade-off.
E) Efficient markets.
12) The attempt to improve performance either by identifying mispriced securities or by timing
the performance of broad asset classes is a characteristic of:
A) Active management
B) Passive management
C) Both active and passive management
D) Risk-return trade-off
E) Efficient markets
13) A common measure of credit risk in the banking sector is
A) systemic Risk.
B) treasury-bill.
C) TED spread.
D) LIBOR.
E) yield curve.
. 3
, 14) ______ is in an insurance contract against the default of one or more borrowers.
A) Collateralized debt obligation
B) credit default swap
C) Freddie Mac
D) Adjustable-rate mortgage
E) Fannie Mae
15) Systemic risk is
A) credit risk.
B) an insurance contract against the default of one or more borrowers.
C) firm-specific risk.
D) default risk.
E) the potential breakdown of the financial system when problems in one market spill
over and disrupt others.
16) A fixed-income security pays
A) a fixed level of income for the life of the owner.
B) a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
C) a variable level of income for owners on a fixed income.
D) a fixed or variable income stream at the option of the owner.
17) A debt security pays
A) a fixed level of income for the life of the owner.
B) a variable level of income for owners on a fixed income.
C) a fixed or variable income stream at the option of the owner.
D) a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
18) Money market securities
A) are short term.
B) are highly marketable.
C) are medium risk.
D) are highly marketable and are short term.
E) All of the options.
. 4
Switzer, Maureen Stapleton, Dana Boyko, Christine Panasian (Test Bank All
Chapters, 100% Original Verified, A+ Grade) Answers At The End Of Each Chapter
Chapter 1:__________
1) The material wealth of a society is a function of
A) all financial assets.
B) all real assets.
C) all financial and real assets.
D) all physical assets.
2) ______ are real assets.
A) Land
B) Machines
C) Stocks and bonds
D) Knowledge
E) Land, machines, and knowledge
3) The means by which individuals hold their claims on real assets in a well-developed
economy are
A) investment assets.
B) depository assets.
C) derivative assets.
D) financial assets.
E) exchange-driven assets.
4) ______ are financial assets.
A) Bonds
B) Machines
C) Stocks
D) Bonds and stocks
E) Bonds, machines, and stocks
. 1
,5) ______ financial asset(s).
A) Buildings are
B) Land is a
C) Derivatives are
D) Canadian T-Bills are
E) Derivatives and Canadian bonds are
6) Financial assets
A) directly contribute to the country's productive capacity.
B) indirectly contribute to the country's productive capacity.
C) contribute to the country's productive capacity, both directly and indirectly.
D) do not contribute to the country's productive capacity, either directly or indirectly.
E) are of no value to anyone.
7) A security that pays a specified cash flow over a specific period is called
A) fixed income.
B) stock option.
C) mutual fund.
D) real estate.
E) index.
8) ______ is a commodity.
A) Money
B) Forward contract
C) Natural gas
D) A bond
E) Treasury-bill
9) Compared to investments in debt securities, equity investments tend to be
A) equally risky.
B) riskier.
C) less risky.
D) more important.
. 2
,10) Which one of the following is not a role of the financial markets?
A) Consumption timing
B) Information
C) Separation of ownership and control
D) Increasing wealth of the economy
E) Risk allocation
11) Holding highly diversified portfolios without spending effort or other resources attempting to
improve investment performance through security analysis is a characteristic of
A) Active management.
B) Passive management.
C) Both active and passive management.
D) Risk-return trade-off.
E) Efficient markets.
12) The attempt to improve performance either by identifying mispriced securities or by timing
the performance of broad asset classes is a characteristic of:
A) Active management
B) Passive management
C) Both active and passive management
D) Risk-return trade-off
E) Efficient markets
13) A common measure of credit risk in the banking sector is
A) systemic Risk.
B) treasury-bill.
C) TED spread.
D) LIBOR.
E) yield curve.
. 3
, 14) ______ is in an insurance contract against the default of one or more borrowers.
A) Collateralized debt obligation
B) credit default swap
C) Freddie Mac
D) Adjustable-rate mortgage
E) Fannie Mae
15) Systemic risk is
A) credit risk.
B) an insurance contract against the default of one or more borrowers.
C) firm-specific risk.
D) default risk.
E) the potential breakdown of the financial system when problems in one market spill
over and disrupt others.
16) A fixed-income security pays
A) a fixed level of income for the life of the owner.
B) a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
C) a variable level of income for owners on a fixed income.
D) a fixed or variable income stream at the option of the owner.
17) A debt security pays
A) a fixed level of income for the life of the owner.
B) a variable level of income for owners on a fixed income.
C) a fixed or variable income stream at the option of the owner.
D) a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
18) Money market securities
A) are short term.
B) are highly marketable.
C) are medium risk.
D) are highly marketable and are short term.
E) All of the options.
. 4
