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MCQs

Total Questions : 141 | Page 6 of 15 pages
Question 51. The realized and required return for individual stocks are classified as function of fundamental
  1.    arbitrage factors
  2.    economic factors
  3.    portfolio factors
  4.    realized theory factors
 Discuss Question
Answer: Option B. -> economic factors
Answer: (b).economic factors
Question 52. The first factor in the Fama French three factor model is
  1.    CAPM stock beta
  2.    economic stock beta
  3.    CAPM portfolio beta
  4.    CAPM realized beta
 Discuss Question
Answer: Option A. -> CAPM stock beta
Answer: (a).CAPM stock beta
Question 53. The formula written as market risk premium divided by standard deviations of returns on market portfolio is used to calculate
  1.    capital market line
  2.    security market line
  3.    fixed market line
  4.    variable market line
 Discuss Question
Answer: Option A. -> capital market line
Answer: (a).capital market line
Question 54. A line which shows the relationship between an expected return and risk on efficient portfolio is considered as
  1.    efficient market line
  2.    attributable market line
  3.    capital market line
  4.    security market line
 Discuss Question
Answer: Option C. -> capital market line
Answer: (c).capital market line
Question 55. In arbitrage pricing theory, the higher required rate of return is usually paid on the stock
  1.    higher market risk
  2.    higher dividend
  3.    lower dividend
  4.    lower market risk
 Discuss Question
Answer: Option B. -> higher dividend
Answer: (b).higher dividend
Question 56. The relationship between total risk of stock, diversifiable risk and market risk is classified as
  1.    total risk
  2.    standard deviation
  3.    standard alpha
  4.    treynor alpha
 Discuss Question
Answer: Option A. -> total risk
Answer: (a).total risk
Question 57. In capital asset pricing model, the investors assume that buying and selling activity will
  1.    affect stock prices
  2.    not affect stock prices
  3.    have high taxes
  4.    high transaction cost
 Discuss Question
Answer: Option B. -> not affect stock prices
Answer: (b).not affect stock prices
Question 58. For the investors, the more steeper slope of indifference curve shows the more
  1.    risk averse investor
  2.    risk taker investor
  3.    in differential investor
  4.    ineffective investment
 Discuss Question
Answer: Option A. -> risk averse investor
Answer: (a).risk averse investor
Question 59. The positive minimum risk portfolio of any security shows that market security sold
  1.    equal to original price
  2.    equal to sum of stocks
  3.    less than original price
  4.    greater than original price
 Discuss Question
Answer: Option D. -> greater than original price
Answer: (d).greater than original price
Question 60. In capital asset pricing model, the assumptions must be followed including
  1.    no taxes
  2.    no transaction costs
  3.    fixed quantities of assets
  4.    all of the above
 Discuss Question
Answer: Option D. -> all of the above
Answer: (d).all of the above

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