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MCQs

Total Questions : 141 | Page 4 of 15 pages
Question 31. The stock with large amount of contribution of risk in a diversified portfolio is represented by
  1.    high beta and standard deviation
  2.    high beta, low standard deviation
  3.    low beta, low standard deviation
  4.    low beta, low variance
 Discuss Question
Answer: Option A. -> high beta and standard deviation
Answer: (a).high beta and standard deviation
Question 32. The high portfolio return is 6.5% and the low portfolio return is 3.0% then the HML portfolio will be
  1.    0.0216
  2.    0.095
  3.    0.035
  4.    0.4615 times
 Discuss Question
Answer: Option C. -> 0.035
Answer: (c).0.035
Question 33. An efficient set of portfolios represented through graph is classified as an
  1.    attained frontier
  2.    efficient frontier
  3.    inefficient frontier
  4.    unattained frontier
 Discuss Question
Answer: Option B. -> efficient frontier
Answer: (b).efficient frontier
Question 34. The stocks which has lower book for market ratio are considered as
  1.    optimistic
  2.    more risky
  3.    less risky
  4.    pessimistic
 Discuss Question
Answer: Option C. -> less risky
Answer: (c).less risky
Question 35. The future beta is needed to calculate in most situations is classified as
  1.    historical betas
  2.    adjusted betas
  3.    standard betas
  4.    varied betas
 Discuss Question
Answer: Option A. -> historical betas
Answer: (a).historical betas
Question 36. An individual stock required return is equal to risk free rate plus bearing risk premium is an explanation of
  1.    security market line
  2.    capital market line
  3.    aggregate market line
  4.    beta market line
 Discuss Question
Answer: Option A. -> security market line
Answer: (a).security market line
Question 37. According to capital asset pricing model assumptions, the quantities of all the assets are
  1.    given and fixed
  2.    not given and fixed
  3.    not given and variable
  4.    given and variable
 Discuss Question
Answer: Option A. -> given and fixed
Answer: (a).given and fixed
Question 38. The negative minimum risk portfolio of any security shows that market security sold
  1.    less than original price
  2.    greater than original price
  3.    equal to original price
  4.    equal to sum of stocks
 Discuss Question
Answer: Option A. -> less than original price
Answer: (a).less than original price
Question 39. According to Fama French Three-Factor model, the market value of company equity is used to calculate
  1.    size of portfolio
  2.    size of industry
  3.    size of market
  4.    size of company
 Discuss Question
Answer: Option D. -> size of company
Answer: (d).size of company
Question 40. A model which regresses the return of stock against the return of market is classified as
  1.    regression model
  2.    market model
  3.    error model
  4.    risk free model
 Discuss Question
Answer: Option B. -> market model
Answer: (b).market model

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