Pre-Summer Sale Special Limited Time 65% Discount Offer - Ends in 0d 00h 00m 00s - Coupon code: v4s65

8006 Exam Dumps - Exam I: Finance Theory Financial Instruments Financial Markets - 2015 Edition

Go to page:
Question # 33

Two portfolios with identical Sharpe ratios will have

A.

identical expected risk

B.

identical expected risk and returns

C.

returns identically proportionate to risk

D.

identical expected returns

Full Access
Question # 34

Calculate the basis point value, or PV01, of a bond with a modified duration of 5 and a price of $102.

A.

$0.51

B.

$5.10

C.

$0.0051

D.

$0.051

Full Access
Question # 35

What kind of a risk attitude does a utility function with an upward sloping curvature indicate?

A.

risk seeking

B.

risk neutral

C.

risk averse

D.

risk mitigation

Full Access
Question # 36

When considering an appropriate mix of debt and equity, Chief Financial Officers generally consider:

I. Tax advantage of debt

II. Financial distress costs

III. Agency costs of equity

IV. Retaining financial flexibility

A.

I and II

B.

I, III and IV

C.

I, II, III and IV

D.

I, II and IV

Full Access
Question # 37

The vast majority of exchange traded futures contracts are:

A.

closed by an offsetting trade prior to expiry

B.

settled using physical settlements

C.

cash settled upon expiry

D.

settled by delivery

Full Access
Question # 38

Credit derivatives can be used for:

I. Reducing credit exposures

II. Reducing interest rate risks

III. Earn credit risk premiums

IV. Get market exposure without taking cash market positions

A.

II, III and IV

B.

I, III and IV

C.

I and IV

D.

I, II and III

Full Access
Question # 39

Which of the following statements are true:

I. Cash markets tend to be more liquid than derivative markets

II. A higher credit risk is associated with lower liquidity in times of crises

III. A higher bid-ask spread indicates greater liquidity when compared to a lower bid-ask spread

IV. A higher normal market size indicates greater liquidity than a lower market size

A.

I, II and III

B.

I, III and IV

C.

II and IV

D.

II, III and IV

Full Access
Question # 40

An investor has a bullish outlook on the market. Which of the following option strategies would suit him?

I. Risk reversal

II. Collar

III. Bull spread

IV. Butterfly spread

A.

II and IV

B.

I, III and IV

C.

I and III

D.

I, II, III and IV

Full Access
Go to page: