multiple choice

ANSWER ALL QUESTIONS SECTION A: MULTIPLE CHOICE QUESTIONS (30 MARKS) Please choose the BEST AND CORRECT ANSWER for each of the following questions. Write your answer in the answer sheet provided. Q1. Suppose you buy 1000 shares of Healthy and Happy Berhad on 55% margin when it is selling at RM4.20 a share at the beginning of the year. If at year end you receive a RM0.55 per share dividend and sell the stock for RM4.60, what are the rates of return on the investment by taking 4.5% annual cost of interest and 0.6% brokerage fees of transaction value for each way of the transaction? Minimum transaction cost of RM40.00 rule applies in this case if it is applicable, other transaction costs are ignored A.-12.98% B. 23.50% C. 30.50% D. 33.98% Q2. Samini has invested RM10,000 in Stock A is worth RM12,000 in six months. What is the annual holding period (HPY) for her investment? A. 9.5% B. 20% C. 40% D. 44% Q3. Johan has invested in an investment product, compute the arithmetic mean return (AM) and geometric mean return (GM) for the following returns by assuming the data is obtained from the population? Year 1: 12% Year 2: -3% Year 3: 5% A. AM: 4.70%: GM: 3.50% B. AM: 4.67%; GM: 4.77% C. AM: 4.25%; GM: 4.46% D. AM: 4.67%; GM: 4.46% Q4. During the past five years, Amirah owned 4 stocks that had the following past annual rates of returns by assuming the data is obtained from the population: Stock C Year 1 2 3 Stock A 0.08 0.03 -0.09 Stock B -0.10 0.15 0.08 0.07 Stock D 0.19 0.80 -0.12 0.06 0.08 Based on standard deviation measure, which stock is the most preferrable? A. Stock A B. Stock B C. Stock C D Stock D