1. Which type of brokerage account is likely to be the most inexpensive for a retail customer doing only a few trades each year?

• Wrap accounts
• Cash account
• Margin account
• Asset management account
• none of the answers is correct

2. For U.S. investors, which of the following is a source of risk involved with international investments, but not with domestic investments?

• Exchange rate risk
• Business risk
• none of the answers is correct.
• Inflation risk
• Liquidity risk

3. Which of the following statements is incorrect?

• The standard deviation of return measures the market or systematic risk of one security or a portfolio of securities.
• All the answers are correct except one.
• An impending recession is an example of market risk.
• Since standard deviation is measured in the same units as the mean, standard deviation is used more commonly than variance when performing investment analysis and calculations.
• The standard deviation of a security measures the total risk of the security.