STRAYER FIN100 WEEK 6 QUIZ

| September 28, 2018

1. Which of these is a measure
summarizing the overall past performance of an investment?
Average return
Dollar return
Market return
Percentage return
2. Which
of the following is the reward investors require for taking risk?
Market
risk premium
Required
return
Risk-free
rate
Risk
premium
3. Which
of the following is defined as the volatility of an investment, which includes
firm specific risk as well as market risk?
Market
risk
Total
risk
Diversifiable
risk
Standard
deviation
4. Which
of these is the set of probabilities for all possible occurrences?
Market
probabilities
Probability
distribution
Probability
Stock
market bubble
5. Which
of these is the investor’s combination of securities that achieves the highest
expected return for a given risk level?
Efficient
portfolio
Total
portfolio
Optimal
portfolio
Modern
portfolio
6. To
find the percentage return of an investment:
divide
the dollar return by the investment’s value at the beginning of the period.
multiply
the dollar return by the investment’s value at the beginning of the period.
multiply
the dollar return by the investment’s value at the end of the period.
divide
the dollar return by the investment’s value at the end of the period.
7. Which
of the following is an index that tracks 500 companies, which allows for a
great deal of diversification?
Fortune
500
Wall
Street Journal
Nasdaq
S&P
500
8. Which
of these is the line on a graph of return and risk (standard deviation) from
the risk-free rate through the market portfolio?
Efficient
market line
Capital
market line
Efficient
market hypothesis
Capital
asset pricing line
9. Which
of the following is a model that includes an equation that relates a stock’s
required return to an appropriate risk premium?
Efficient
markets
Beta
Behavioral
finance
Asset
pricing
10.
Which of the following is data that includes past stock prices and volume,
financial statements, corporate news, analyst opinions, etc.?
Generally
accepted accounting principles
Public
information
Privately
held information
Audited
financial statements
11.
Which of the following are the stocks of small companies that are priced below
$1 per share?
Penny
stocks
Hedge
fund stocks
Bargain
stocks
Stock
market bubble stocks
12.
TechNo stock was $25 per share at the end of last year. Since then, it paid a
$1.50 per share dividend last year. The stock price is currently $23. If you
owned 300 shares of TechNo, what was your percent return?
6
percent
-2
percent
6.5
percent
-8
percent
13.
Which of the following is another term for market risk?
Modern
portfolio risk
Firm
specific risk
Total
risk
Nondiversifiable
risk
14.
Investor enthusiasm causes an inflated bull market that drives prices too high,
ending in a dramatic collapse in prices is known as:
privately
held information.
efficient
market.
behavior
finance.
stock
market bubble.
15.
Which of the following is defined as the portion of total risk that is
attributable to firm or industry factors and can be reduced through
diversification?
Modern
portfolio risk
Firm
specific risk
Market
risk
Total
risk
16. Which of the following is a true statement?
If
a firm takes on riskier new projects over time, the firm itself will become
less risky.
Firms
can quite possibly change their stocks’ risk level by substantially changing
their business.
The
risk and return that a firm experienced in the past is also the risk level for
its future.
If
a firm takes on less risky new projects over time, the firm itself will become
more risky.
17.
Which of these is similar to the Capital Market Line, except that risk is
characterized by beta instead of standard deviation?
Security
market line
Probability
market line
Stock
market line
Market
risk line
18.
Which of these includes any capital gain (or loss) that occurred as well as any
income that you received from a specific investment?
Portfolio
Average
return
Market
return
Dollar
return
19.
In theory, which of these is a combination of securities that places the
portfolio on the efficient frontier and on a line tangent from the risk-free
rate?
Efficient
market
Market
portfolio
Stock
market bubble
Probability
distribution
20.
We commonly measure the risk-return relationship using which of the following?
Expected
returns
Correlation
coefficient
Coefficient
of variation
Standard
deviation

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