Antoinette brags that her portfolio's rate of return is "beating the market". Which one of the following would best substantiate her claim?

a	positive Jensen's alpha
b	zero Value at Risk (V@R)
c	negative Treynor ratio
d	beta greater than 1.0
e	positive Sharpe ratio

Which one of the following is most apt to create an environment that increases mortgage prepayments?

a

home mortgage rates remain relatively steady

b

home mortgage rates decline significantly

c

number of homeowner's defaulting on their mortgages rises

d

homeowner's have steady, secure employment at their current jobs

e

number of employees being transferred for employment purposes declines

First Interstate Bank of Idaho needs to borrow money overnight from the Federal Reserve in order to meet its reserve requirements. Which one of the following interest rates will be charged on this loan?

a

discount

b

prime

c

Treasury

d

money market

e

Federal funds

Which one of the following stocks has the highest expected risk premium?

Stock	Standard Deviation	Beta
A	14%	1.36
B	21%	0.98
C	34%	1.02
D	8%	1.18
E	55%	1.27

Price risk is the risk that:

a	market prices increase due to market interest rate changes making bonds more expensive to purchase.
b	the bond principal will not be paid in full or on time.
c	coupon payments will be reinvested at a rate that is less than the bond's yield-to-maturity.
d	the bonds in a dedicated portfolio will decrease in value in response to an increase in interest rates.
e	the yield-to-maturity will be less than the inflation risk causing the real rate of return to be negative.