Question
QUESTION 16 New stock issues are considered a special investment situation because a. they exhibit a very good long-term investment potential b. the spread is
QUESTION 16
-
New stock issues are considered a special investment situation because
a. they exhibit a very good long-term investment potential
b. the spread is greater than that in the secondary market
c. there is some evidence that new issues are underpriced
d. more than one of the above
2 points
QUESTION 17
-
A call is said to be in-the-money when the strike price is ________the market
price.
a. equal to
b. greater than
c. less than
d. A) may be more than one of the above depending on the option premium
2 points
QUESTION 18
-
An example of secured debt would be a:
a. contract where two signatures specified how the contract would be paid
b. contract in which a court kept the contract in its possession to see that nothing
would happen to it
c. contract in which real assets are pledged as security for a loan
d. debenture
2 points
QUESTION 19
-
Systematic risk is rewarded with a premium in the marketplace because
a. that risk is peculiar to the stock or industry
b. it represents a random occurrence which could not have been foreseen
c. it is associated with market movements which cannot be eliminated through
diversification
d. none of the above
2 points
QUESTION 20
-
What formula measure would an investor use to calculate the yield on a 20 year bond
with 10 years to maturity, if he or she only intends to hold the bond for 5 years?
a. anticipated realized yield
b. yield to call
c. current yield
d. any one of the above will measure the yield
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