C nonsystematic risk D-market risk. 28. Ahmad wishes to find the effective annual rate associated with a 10% mal uman rate when interest is compounded quarterly A- 10.38% B- 10.25% C- 10.11% D- 10% 29. It is the chance that a given outcome will occur: A- Risk B- Probability C- Real return D- Nominal return. - Treasury bills are example of: A- Risk-free assets. B- Risky assets C- Risk premium D- None of the above. Section3 and Problem solving (10 marks) are the assumptions that CAPM based on them regarding the market Add a caption... .***. > Jaz 21. Mest vers are risks, which Awe 22. Which of the following Mutual funds were psively med Cul fod lounched in 1924, while st ETF Sched in Jay 1993 D ETFs have higher fees and higher experts dan Sunds B-45% C-40% D. 35% and ETENT 23. You purchased a share of stock for $30. One year later you reed 51 as a divid and sold the share for $29. What was your holding perind retur? A- 50% is the chance of loss or the variability of returns related to ap A Retu B- Valee C- Risk D- Probability - 5. Over the past year you earned a nominal rate of interest of 8% in your mone inflation rate was 4% over the same period. The exact actual growth rate purchasing power (real rate) was: A- 15.5% B-165 C- 3.8% D- 4.8% Sum of returns in each period divided by number of periods: A- Geometric average B- Arithmetic average C- Dollar-weighted average return D- HPB e risk that cannot be diversified away: A- firm-specific risk B- Unique risk. King Min Col Al 14. A statistic that measures how the returns of two risky assets move A- covariance and correlation. B- standard deviation. C- alpha D- beta 15. Suppose we form a portfolio with 40% in stocks and 60% in bond of return on stock at a normal economic growth is 14 % and 8 %0 expected return on this portfolio? A- 13% B- 10.4 % C-14% D- 15% 16. Pools of money invested in a portfolio that is fixed for the life of the A- Open-end funds B- Closed-end funds. C- Unit investments trusts. D- Managed investment companies. 17. Which of the following functions do investment companies perform A- Record keeping and administration periodic status repos B- Diversification and divisibility. C- Professional management and Lower transaction costs. D- All choices are correct. 18. The Xx Fund had net asset value per share of $36.12 on January 1, 31 of the same year the fund's NAV was $39.71. Income distributi the fund had capital gain distributions of $1.13. what rate of ret receive on the Xx Fund last year? A- 22.92% B- 17.68% C- 14.84% D- 18.52% 19. Capital allocation line using market-index portfolio as risky asset ca A- Capital Assets. B- Capital Allocation Line. C- Capital Index. D- Capital Market Line. 20. Firm-specific risk is also referred to as: A- systematic risk or diversifiable risk. B- systematic risk or market risk. C- diversifiable risk or market risk. D- diversifiable risk or unique risk. 5 Section2 There are 22 Multi-choice Questions below, Put Circle to the Mark Each): 9. Market risk is also referred to as A- systematic risk or diversifiable risk. B-systematic risk or non-diversifiable risk. C- unique risk or non-diversifiable risk. D- unique risk or diversifiable risk. 10. Which one of the following statements regarding open-end m A- The funds redeem shares at net asset value. B- The funds offer investors professional manag C- No change in shares outstanding unless new D- It consists of collective investments in whi their funds to be managed by a portfolio ma 11. Multiple Mutual Funds had year-end assets of $4 $17,000,000. There were 24,300,000 shares in the fund a Mutual's net asset value? A- $18.11 B- $18.81 C- $69.96 D- $7.07 12. of the following types of ETFs, an investor who wish that tracks the Dow Jones should choose: A- SPDR DIA. B- SPDR S&P 500 C- QQQ Trust Series 1 D- iShares MSCI EM 13. The measure of risk in a Markowitz efficient fro A-specific risk. B- standard deviation of returns. C- reinvestment risk. D-beta. Kingdo Finistr allege asala 10 12 Section1 There are 8 True-False below, Put Circle to the correct answer (1 M 1. Value at risk is the worst loss with given probability, usually 1% or 5% A- True. B- False 2. Real Estate Investment Trust invests in real estate and real estate loans. A- True. B- False 3. The real rate of interest changes with changing economic conditi preferences. A A- Truc B- False 4. Index model relates stock returns to returns on broad market index a factors. A- True B- False 5. The portfolio return is the weighted average of the returns on each equal to the proportion of the portfolio invested in each fund. A- True B- False 6. Active strategy is an investment policy that based on the premise t priced, and it avoids the costs involved in undertaking security a A- True. B- False 7. Examples of the company-specific influences are firm's success management style and philosophy, and so on. A- True B- False 8. Some examples inflation, in "oeconomics variable that cause marke rates, and so forth. exche 3 Section2 There are 22 Multi-choice Questions below, Put Circle to the Mark Each): 9. Market risk is also referred to as A- systematic risk or diversifiable risk. B-systematic risk or non-diversifiable risk. C- unique risk or non-diversifiable risk. D- unique risk or diversifiable risk. 10. Which one of the following statements regarding open-end m A- The funds redeem shares at net asset value. B- The funds offer investors professional manag C- No change in shares outstanding unless new D- It consists of collective investments in whi their funds to be managed by a portfolio ma 11. Multiple Mutual Funds had year-end assets of $4 $17,000,000. There were 24,300,000 shares in the fund a Mutual's net asset value? A- $18.11 B- $18.81 C- $69.96 D- $7.07 12. of the following types of ETFs, an investor who wish that tracks the Dow Jones should choose: A- SPDR DIA. B- SPDR S&P 500 C- QQQ Trust Series 1 D- iShares MSCI EM 13. The measure of risk in a Markowitz efficient fro A-specific risk. B- standard deviation of returns. C- reinvestment risk. D-beta. King Min Col Al 14. A statistic that measures how the returns of two risky assets move A- covariance and correlation. B- standard deviation. C- alpha D- beta 15. Suppose we form a portfolio with 40% in stocks and 60% in bond of return on stock at a normal economic growth is 14 % and 8 %0 expected return on this portfolio? A- 13% B- 10.4 % C-14% D- 15% 16. Pools of money invested in a portfolio that is fixed for the life of the A- Open-end funds B- Closed-end funds. C- Unit investments trusts. D- Managed investment companies. 17. Which of the following functions do investment companies perform A- Record keeping and administration periodic status repos B- Diversification and divisibility. C- Professional management and Lower transaction costs. D- All choices are correct. 18. The Xx Fund had net asset value per share of $36.12 on January 1, 31 of the same year the fund's NAV was $39.71. Income distributi the fund had capital gain distributions of $1.13. what rate of ret receive on the Xx Fund last year? A- 22.92% B- 17.68% C- 14.84% D- 18.52% 19. Capital allocation line using market-index portfolio as risky asset ca A- Capital Assets. B- Capital Allocation Line. C- Capital Index. D- Capital Market Line. 20. Firm-specific risk is also referred to as: A- systematic risk or diversifiable risk. B- systematic risk or market risk. C- diversifiable risk or market risk. D- diversifiable risk or unique risk. 5