1. Which of the following is NOT included in the Product Disclosure Statement (PDS):

a.Significant characteristics of the financial product.

b.Details of any potential conflicts of interest.

c.Fee payable in respect of a financial product

d.Risks of the financial product

2. Which one of the following statements is NOT true about secondary markets?

a.In Australia, most secondary equity market transactions take place on the Australian Securities Exchange (ASX).

b.Companies listed on the New York Stock Exchange (NYSE) tend to be, on average, larger in size and their shares trade more frequently than companies whose securities trade on Australian Securities Exchange (ASX).

c.In terms of the number of companies listed and shares traded on a daily basis, the New York Stock Exchange (NYSE) is larger than the Australian Securities Exchange (ASX).

d.In terms of total volume of activity and total capitalisation of the companies listed, the Australian Securities Exchange (ASX) is the largest in the world and the New York Stock Exchange (NYSE) is the second largest.

3. Which one of the following is FALSE?

a.Preference shareholders stand in front of ordinary shareholders in line for dividends.

b.The previously unpaid dividend for non-cumulative preference shares cannot be skipped.

c.For tax, legal and accounting purposes, preference shares are treated as equity.

d.Unlike debtholders, preference shareholders cannot force a firm into bankruptcy.

4. A risk-free, zero-coupon bond with a face value of $100 has 10 years to maturity. If the YTM is 6.8% per annum, compounded semi-annually, which of the following would be the price of this bond (round to the nearest 2 decimal point)?

a.$26.25

b.$51.24

c.$36.68

d.$38.31