Question
7) Which of the following is correct? (a) A change in the inherent risk of an investment will cause a movement along the Security Market
7) Which of the following is correct?
(a) A change in the inherent risk of an investment will cause a
movement along the Security Market Line.
(b) A change in investors' attitudes toward risk will cause a change in
the market risk premium, and cause a change in the slope of the
Security Market Line.
(c) A change in the inherent risk of an investment will cause the
Security Market Line to shift.
(d) A change in expected real growth, capital market conditions or
expected rate of inflation will cause a parallel shift of the Security
Market Line.
(e) a, b, c, and d.
(f) a, b and d.
(g) a and b only.
8) ________________ and ______________ are examples of "Top
Down" investment strategy.
9) True or False: Low Price/Book, low P/E and consumer & services are
characteristics associated with value stocks.
10) Which of the following ratios is NOT a leverage ratio?
(a) Total Debt/Total Assets
(b) Debt-to-Equity Ratio
(c) Current Ratio
(d) Long Term Debt to Total Capital Ratio
(e) b & c
11) In addition to measuring performance and risk, the major uses of
financial ratios are ________________, ________________, and
___________________.
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