Finance MCQs

Page No. 12

Chance of happening any unfavorable event in near future is classified as___________?


aChance


bEvent happening


cProbability


dRisk


View Answer Risk

Coefficient of variation is used to identify an effect of__________?


aRisk


bReturn


cDeviation


dBoth A and B


View Answer Both A and B

A tighter probability distribution shows the___________?


aHigher risk


bLower risk


cExpected risk


dPeaked risk


View Answer Lower risk

Standard deviation is divided by expected rate of return is used to calculate_________?


aCoefficient of variation


bCoefficient of deviation


cCoefficient of standard


dCoefficient of return



In capital asset pricing model, stock with high standard deviation tend to have________?


aLow variation


bLow beta


cHigh beta


dHigh variation


View Answer Low beta

Risk which is caused by events such as strikes, unsuccessful marketing programs and other lawsuits is classified as____________?


aStock risk


bPortfolio risk


cDiversifiable risk


dMarket risk


View Answer Diversifiable risk

A portfolio consists of all stocks in a market is classified as____________?


aMarket portfolio


bReturn portfolio


cCorrelated portfolio


dDiversified portfolio


View Answer Market portfolio

Beta coefficient is used to measure market risk which is an index of__________?


aCoefficient risk volatility


bMarket risk volatility


cStock market volatility


dPortfolio market portfolio



External factors such as expiration of basic patents and industry competition effect____________?


aPatents premium


bCompetition premium


cCompany’s beta


dExpiry premium


View Answer Company’s beta

Type of risk in which beta is equal to one is classified as____________?


aMultiple risk stock


bVaried risk stock


cTotal risk stock


dAverage risk stock


View Answer Average risk stock

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