16. Which strategy on average survives the longest?

A. Directional

B. Non-directional

C. A& B

D. None of the above

12. Which of the following four hedge fund strategies would be most likely to include the other three strategies?

A. Merger arbitrage

B. Fixed income arbitrage

C. Relative value arbitrage (Pairs Trading)

D. Convertible arbitrage

33. On Monday March 11, 2019 the 1-Year USD Libor Rate is 2.8636% while the 1-year Euro Libor Rate is -0.1749%. Currently the Euro/USD spot exchange rate sits at 1.1241. The Uncovered Interest Rate parity implies that the expected 1-year spot EUR/USD exchange rate is going to:

A. depreciate to 1.0909

B. appreciate to 1.0909

C. appreciate to 1.1583

D. depreciate to 1.1583

34. Suppose you have the following: S= stock price 50 r= risk free rate 4% T= maturity 5 t= time to expiration = vol 25% q= div yield 0 Conv Ratio 15 Credit Spread 4% Coupon 20 What is the up step, down step, probability of the stock increasing at the next node (p), and probability of the stock decreasing at the next step (1-p) (hint: p = (e^(r*t)-d)/(u-d)):

A. 1.28; 0.77; 0.51; 0.48

B. 0.77; 1.28; 0.48; 0.51.

C. 1.34; 0.74; 0.49; 0.51

D. 0.74; 1.34; 0.50, 0.49.