22. A pension fund must pay out $1 million next year, $2 million the following year, and then $3 million the following year. If the discount rate is 8%, what is the duration of this set of payments?

a.

2.29 years

b.

2.15 years

c.

2 years

d.

2.53 years

23. An investor who acts guided by the Semi-Strong Form of the EHR is considered an investor with an active investment strategy.

a.

Certain

b.

Fake

24. In a well-diversified portfolio, __________ risk is not relevant.

a.

not diversifiable

b.

systematic

c.

unsystematic

d.

market

25. Some of the central postulates of the Efficient Markets Hypothesis (EMH) are the following, except:

a.

No one will be able to generate extraordinary returns (abnormal returns) in efficient investment markets

b.

One of the factors that contributes to the efficiency of the markets is that investors react quickly to new information causing stock prices to adjust almost immediately.

c.

The EHR stipulates that the information is totally asymmetric

d.

The efficiency of markets requires that adjustments to new information occur as fast as the information reaches the market.