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MCQs

Total Questions : 141 | Page 7 of 15 pages
Question 61. The third factor in the Fama French three factor model is the ratio which is classified as
  1.    book to market ratio
  2.    market to book ratio
  3.    company to industry ratio
  4.    stock to portfolio ratio
 Discuss Question
Answer: Option B. -> market to book ratio
Answer: (b).market to book ratio
Question 62. The past realized rate of return in period t is denoted by
  1.    t bar r
  2.    t hat r
  3.    r hat t
  4.    r bar t
 Discuss Question
Answer: Option D. -> r bar t
Answer: (d).r bar t
Question 63. The type of risk in which beta is equal to one is classified as
  1.    multiple risk stock
  2.    varied risk stock
  3.    total risk stock
  4.    average risk stock
 Discuss Question
Answer: Option D. -> average risk stock
Answer: (d).average risk stock
Question 64. A portfolio consists of all the stocks in a market is classified as
  1.    market portfolio
  2.    return portfolio
  3.    correlated portfolio
  4.    diversified portfolio
 Discuss Question
Answer: Option A. -> market portfolio
Answer: (a).market portfolio
Question 65. An amount invested is $1500 and an amount received is $2000 then the dollar return would be
  1.    500
  2.    −$500
  3.    3500
  4.    −$3500
 Discuss Question
Answer: Option A. -> 500
Answer: (a).500
Question 66. The external factors such as expiration of basic patents and industry competition effect
  1.    patents premium
  2.    competition premium
  3.    company's beta
  4.    expiry premium
 Discuss Question
Answer: Option C. -> company's beta
Answer: (c).company's beta
Question 67. The beta coefficient is used to measure market risk which is an index of
  1.    coefficient risk volatility
  2.    market risk volatility
  3.    stock market volatility
  4.    portfolio market portfolio
 Discuss Question
Answer: Option C. -> stock market volatility
Answer: (c).stock market volatility
Question 68. A technique of lowering the risk for multinational companies and globally designed portfolios is classified as
  1.    national diversification
  2.    behavioral diversification
  3.    global diversification
  4.    behavioral finance
 Discuss Question
Answer: Option C. -> global diversification
Answer: (c).global diversification
Question 69. The standard deviation of tighter probability distribution is
  1.    long-termed
  2.    short-termed
  3.    riskier
  4.    smaller
 Discuss Question
Answer: Option D. -> smaller
Answer: (d).smaller
Question 70. The risk which is caused by events such as strikes, unsuccessful marketing programs and other lawsuits is classified as
  1.    stock risk
  2.    portfolio risk
  3.    diversifiable risk
  4.    market risk
 Discuss Question
Answer: Option C. -> diversifiable risk
Answer: (c).diversifiable risk

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