Finance MCQs

Page No. 13

Standard deviation of tighter probability distribution is____________?


aLong-termed


bShort-termed


cRiskier


dSmaller


View Answer Smaller

Sum of market risk and diversifiable risk are classified as total risk which is equivalent to_______________?


aSharpe’s alpha


bStandard alpha’s


cAlpha’s variance


dVariance


View Answer Variance

Two alternative expected returns are compared with help of__________?


aCoefficient of variation


bCoefficient of deviationCoefficient of standard


cCoefficient of standard


dCoefficient of return



An inflation free rate of return and inflation premium is two components of_________?


aQuoted rate


bUnquoted rate


cSteeper rate


dPortfolio rate


View Answer Quoted rate

An analysis of decision making of investors and managers is classified as_________?


aRiskier finance


bBehavioral finance


cPremium finance


dBuying finance


View Answer Behavioral finance

Risk affects any firm with factors such as war, recessions, inflation and high interest rates is classified as____________?


aDiversifiable risk


bMarket risk


cStock risk


dPortfolio risk


View Answer Market risk

Positive minimum risk portfolio of any security shows that market security sold____________?


aEqual to original priceEqual to sum of stocks


bEqual to sum of stocks


cLess than original price


dGreater than original price



Stock issued by company have lower rate of return because of___________?


aHigh market to book ratio


bLow book to market ratio


cLow market to book ratio


dHigh book to market ratio



In capital asset pricing model, assumptions must be followed including________?


aNo taxes


bNo transaction costs


cFixed quantities of assets


dAll of above


View Answer All of above

Type of relationship exists between an expected return and risk of portfolio is classified as___________?


aNon-linear


bLinear


cFixed and aggregate


dNon-fixed and non-aggregate


View Answer Linear

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