question$16$

the coefficient of variation is given by

a$.$ E$($ R$)/$ Standard devoiation

b$.$ Standard deviation $/$ E $($R$)$

c$.$ Standard deviation per unit of return

d$.$ Both b and $c$ are correct

Quesiton $17$

Amount of risk$-$reduction in a portfolio depends upon

$($a$)$Market movement,

$($b$)$ Degree of correlation,

$($c$)$ No$.$ of shares,

$($d$)$ Both $($b$)$ and $($c$).$

Question $18$

You have recently calculated investment risk of two assets. The standard deviation for asset $1$ and two are $2\mathrm{.}722132$ and $8\mathrm{.}124$ per cent respectively. The covariance between two asset is estimated to be $21\mathrm{.}6.$ the best estimate for the correlation coefficient between two asset is

a$.11\mathrm{.}00$

b$.1\mathrm{.}97$

c$.0\mathrm{.}9767$

d$.$ None of the above answer is correct.

Question $19$

The value of a stock can be best described by the following

a$.$ It is future value of expected cash flow

b$.$ It is the future value of the expected dividend and capital gain

c$.$ It is the present value of expected dividend payment and capital gain

d$.$ None of the above answer is correct

Question $20$

The decided to buy stocks the pay first year dividend of $$1\mathrm{.}20$ and second year dividend of $$1\mathrm{.}5.$ at the end year $2$ you are expecting to sell with price of $$20.$ If the required rate of return for the stock is $10\%,$ the value of the stock is:

a$.18\mathrm{.}859$

b$.20\mathrm{.}00$

c$.15\mathrm{.}859$

d$.$ None of the above answer is correct