Question 1

Unemployment declines dramatically. This is a ___________________.

Accepted Answer

A)  leading economic indicators. 
B)  coincidental economic indicators. 
C)  lagging economic indicators. 
D)  not useful as economic indicators. 
A)  leading economic indicators. 
B)  coincidental economic indicators. 
C)  lagging economic indicators. 
D)  not useful as economic indicators.

Question 2

A firm in the early stages of the industry life cycle will likely have

Accepted Answer

A)  high market penetration. 
B)  high risk. 
C)  rapid growth. 
D)  high market penetration and rapid growth. 
E)  high risk and rapid growth. 
A)  high market penetration. 
B)  high risk. 
C)  rapid growth. 
D)  high market penetration and rapid growth. 
E)  high risk and rapid growth.

Question 3

Two firms, A and B, both produce widgets. The price of widgets is $1 each. Firm A has total fixed costs of $500,000 and variable costs of 50¢ per widget. Firm B has total fixed costs of $240,000 and variable costs of 75¢ per widget. The corporate tax rate is 40%. If the economy is strong, each firm will sell 1,200,000 widgets. If the economy enters a recession, each firm will sell 1,100,000 widgets. If the economy is strong, the after-tax profit of Firm A will be

Accepted Answer

A)  $0. 
B)  $6,000. 
C)  $36,000. 
D)  $60,000. 
A)  $0. 
B)  $6,000. 
C)  $36,000. 
D)  $60,000.

Question 4

In 2009 the P/E multiples of the S&P 500 companies was approximately

Accepted Answer

A)  8 
B)  12 
C)  19 
D)  25 
E)  35 
A)  8 
B)  12 
C)  19 
D)  25 
E)  35

Question 5

Assume that the Federal Reserve decreases the money supply. This action will cause ________ to decrease.

Accepted Answer

A)  interest rates 
B)  the unemployment rate 
C)  investment in the economy 
D)  trade balance 
A)  interest rates 
B)  the unemployment rate 
C)  investment in the economy 
D)  trade balance

Question 6

The most widely used monetary tool is

Accepted Answer

A)  altering the discount rate. 
B)  altering the reserve requirements. 
C)  open-market operations. 
D)  altering marginal tax rates. 
E)  None of the options are correct. 
A)  altering the discount rate. 
B)  altering the reserve requirements. 
C)  open-market operations. 
D)  altering marginal tax rates. 
E)  None of the options are correct.

Question 7

Assume the U.S. government was to decide to increase the budget deficit. Holding all else constant, this will cause ______ to decrease.

Accepted Answer

A)  interest rates 
B)  government borrowing 
C)  unemployment 
D)  interest rates and government borrowing 
E)  None of the options are correct. 
A)  interest rates 
B)  government borrowing 
C)  unemployment 
D)  interest rates and government borrowing 
E)  None of the options are correct.

Question 8

Which of the following are not examples of defensive industries?

Accepted Answer

A)  Food producers 
B)  Durable goods producers 
C)  Pharmaceutical firms 
D)  Public utilities 
A)  Food producers 
B)  Durable goods producers 
C)  Pharmaceutical firms 
D)  Public utilities

Question 9

An example of a highly cyclical industry is

Accepted Answer

A)  the automobile industry. 
B)  the tobacco industry. 
C)  the food industry. 
D)  the automobile industry and the tobacco industry. 
E)  the tobacco industry and the food industry. 
A)  the automobile industry. 
B)  the tobacco industry. 
C)  the food industry. 
D)  the automobile industry and the tobacco industry. 
E)  the tobacco industry and the food industry.

Unemployment declines dramatically. This is a ___________________.

A firm in the early stages of the industry life cycle will likely have

In 2009 the P/E multiples of the S&P 500 companies was approximately

Assume that the Federal Reserve decreases the money supply. This action will cause ________ to decrease.

The most widely used monetary tool is

Assume the U.S. government was to decide to increase the budget deficit. Holding all else constant, this will cause ______ to decrease.

Which of the following are not examples of defensive industries?

An example of a highly cyclical industry is

The Investment Environment

Asset Classes and Financial Instruments

How Securities Are Traded

Mutual Funds and Other Investment Companies

Risk, Return, and the Historical Record

Capital Allocation to Risky Assets

Efficient Diversification

Index Models

The Capital Asset Pricing Model

Arbitrage Pricing Theory and Multifactor Models of Risk and Return

The Efficient Market Hypothesis

Behavioral Finance and Technical Analysis

Empirical Evidence on Security Returns

Bond Prices and Yields

The Term Structure of Interest Rates

Managing Bond Portfolios

Equity Valuation Models

Financial Statement Analysis

Options Markets: Introduction

Option Valuation

Futures Markets

Futures, Swaps, and Risk Management

Portfolio Performance Evaluation

International Diversification

Hedge Funds

The Theory of Active Portfolio Management

Investment Policy and the Framework of the Cfa Institute

Filters

Exam 17: Macroeconomic and Industry Analysis

Unemployment declines dramatically. This is a ___________________.

A firm in the early stages of the industry life cycle will likely have

In 2009 the P/E multiples of the S&P 500 companies was approximately

Assume that the Federal Reserve decreases the money supply. This action will cause ________ to decrease.

The most widely used monetary tool is

Assume the U.S. government was to decide to increase the budget deficit. Holding all else constant, this will cause ______ to decrease.

Which of the following are not examples of defensive industries?

An example of a highly cyclical industry is

The Investment Environment

Asset Classes and Financial Instruments

How Securities Are Traded

Mutual Funds and Other Investment Companies

Risk, Return, and the Historical Record

Capital Allocation to Risky Assets

Efficient Diversification

Index Models

The Capital Asset Pricing Model

Arbitrage Pricing Theory and Multifactor Models of Risk and Return

The Efficient Market Hypothesis

Behavioral Finance and Technical Analysis

Empirical Evidence on Security Returns

Bond Prices and Yields

The Term Structure of Interest Rates

Managing Bond Portfolios

Equity Valuation Models

Financial Statement Analysis

Options Markets: Introduction

Option Valuation

Futures Markets

Futures, Swaps, and Risk Management

Portfolio Performance Evaluation

International Diversification

Hedge Funds

The Theory of Active Portfolio Management

Investment Policy and the Framework of the Cfa Institute

Filters