1. Which of the following is not true about an assets beta?

1. It is used in the plotting of the Security Market Line (SML)
2. It is measured as the covariance of the assets return with the market return divided by the variance of the market return
3. It can be calculated using Excels SLOPE() function
4. None of the listed choices

2. Let cells A1 to A5 contain, respectively, the Portfolio Return (A1), Risk-Free Return (A, Standard Deviation of Portfolio Returns (A3), Standard Deviation of Benchmark Portfolio (A4), and Standard Deviation of Downside (A5). Which of the following correctly calculates the M-squared measure and Sharpe ratio, respectively?

1. =A1-A2*A4/A3+A2; =A1-A2/A3
2. =(A1-A2)*A4/A3+A1; =A1-A2/A4
3. =(A1-A2)*(A4/A3)+A1; =(A1-A2)/A4
4. =(A1-A2)*(A4/A3)+A2; =(A1-A2)/A3

3. Which of the following does not need to be considered when calculating a firms financing cost?

1. Cost of equity
2. Tax rate
3. Marginal cost
4. Cost of debt

4. Let cells A1 to A3 contains, respectively, the Risk-Free Rate (A1), the beta of the investment (A2), and the Market Risk Premium (A3). The Capital Asset Pricing Model (CAPM) can be calculated as:

1. =A1+A3
2. =A1-A2*A3
3. =A1+A2*A3
4. =A1-A3

5. Which of the following is not a procedure of constructing a frequency distribution?

1. Calculate the absolute frequency
2. Assign observations to the appropriate interval
3. Define the intervals
4. Count the observations

6. For a sample of 10 observations {1, 3, 5, 6, 23, 2, 5, 18, 20, 7}, what is the arithmetic mean, median, and mode, respectively?

1. 9, 5.5, 5
2. 9, 6, 5
3. 10, 5, 5
4. 9, 5.5, 7