Multiple Choice Questions (1 each): diversisaation are greatest when asset The benefits of d low positive covariances According to the defineons given in the tout, iStock A of 4% and expected retums of standard deviation of 3% and 1%, B has a niskier? returns of which stockis a Stock A b Stock B c. they are equally risky d cannot determine from the information Systematic risk is rewarded with a premium in the a, it is associated with market movements which cannot be eliminated through b, it is a c, that risk is unique to a firm or an d none of the above If the variance for Stock A is greater than the variance for Stock B, then the coefficient variation for Stock a, is greater than the coefficient variation for Stock B bi is less than the coefficient of variation for Stock B c. is the same as the coefficient variation for stock b d, cannot be determined by this 5. If the expected return on Stock 1 is 6%, and the d echer less than or greater than 10% value is the same as its principal amount when the coupon rate is a, the same as the required rate of return b, higher than the required rate of return the requined rate of return d lower than the inflation rate 9. A stock with a constant growth rate has a 12% required rate of retum expects to pay a of S3 What is one year, and is currently selling for S100. the constant growth d) There is not enough information to answer this securities that the sener does not own is O. Sales of a. stop-loss order b, short sale c, limit order 11. The maximum buying price or the minimum selling price specified by the investor is called a b, market order d, limit order 12. If the initial margin requirement is 50% and you hav $5,000 in your brokerage account, you may buy up an additional securities on margin. $2,000 CO N