Question
Question 1 1 pts Calculate the standard deviation of stock PSU over the last three years. Year 1: 10%, Year 2: -3%, Year 3: 5%
Question 1
1 pts
Calculate the standard deviation of stock PSU over the last three years. Year 1: 10%, Year 2: -3%, Year 3: 5%
0.58%
0.70%
1.17%
3.54%
6.55%
Question 2
1 pts
True or False: A rational investor will require a higher return on treasury bonds than stocks.
True
False
Question 3
1 pts
Calculate the rate of return on an investment that you bought for $50, received a $3 dividend, and sold one year later for $55?
10%
5.5%
14.5%
9%
16%
Question 4
1 pts
Given the following information, calculate the Fund's alpha:
T-Bill Return: 2%
S&P 500 Return: 10%
Beta: 1.25
Fund's Return: 15%
5%
-3%
2%
3%
-5%
Question 5
1 pts
If the market returns 8%, PennCo's stock returns 12%, if the market returns -8%, PennCo's stock returns -12%. What is PennCo's Beta?
0.4
0.66
1.4
1.5
0.33
Question 6
1 pts
The ________ helps us to predict the expected return of a risky asset.
Weighted Average Cost of Capital
Capital Asset Pricing Model
Capital Structure Model
Risk/Return Model
Rational Investor Risk Model
Question 7
1 pts
Calculate security ABC's expected return using the capital asset pricing model. Risk Free Rate: 5%, Market Return: 15%, Beta: 1.5
10%
15%
17%
20%
25%
Question 8
1 pts
Calculate the compound annual return on an investment that was purchased at $20 and sold 5 years later for $40.
14.9%
100%
20%
4.6%
16.8%
Question 9
1 pts
There is an indirect relationship between risk and return.
True
False
Question 10
1 pts
Which of the following asset classes would you expect to have the highest expected return and standard deviation?
Treasury bills
Government bonds
Corporate bonds
Large company stocks
Small company stocks
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