What could be a likely consequence of venture capital and private equity firms holding too much dry power?*

1 point

Funds reduce the number of analysts

Funds cut fees

They chase after good startups and overpaying

Mergers and acquisitions among the venture capital and private equity firms

When we evaluate a stock using the Discounted Cash Flow method, the cash flow that we use can be*

1 point

actual earnings the last 15 years

earnings over the the last 10 years which covers one business cycle

expected earnings from the S&P500 stock index

expected earnings

What is the quickest way to gain popularity for a startup?*

1 point

Change the name

Giving Money Away

Move to a new location

Continuing or Discontinuing certain products

A good example of an equity long/short strategy is*

1 point

Short Facebook, short QQQ

Long Amazon, long CVS (the retail pharmacy chain)

Long Citi, short the ETF for the banking industry

Long Citi, short oil

In general, when a hedge fund evaluates a high yield bond, they are looking to*

1 point

All of these are correct

Go short at least 30% of the outstanding bond

Buy the high yield bond in anticipation of a credit rating upgrade

Short the high yield bond and hedge by buying the underlying common stock

Interest rate tends to move in a up and down cycle over time because stronger economic growth leads to*

1 point

higher inflation leads to less new gold mines

higher wages which encourages more spending and company new hires

higher inflation and risk-free rates which discourage new borrowers

greater profit and more new initial public offerings