Question 1

The lower the degree of unsystematic risk,the:

Accepted Answer

A)  higher the diversification of a share portfolio. 
B)  lower a share's beta coefficient. 
C)  higher a share's beta coefficient. 
D)  lower the diversification of a share portfolio. 
A)  higher the diversification of a share portfolio. 
B)  lower a share's beta coefficient. 
C)  higher a share's beta coefficient. 
D)  lower the diversification of a share portfolio.

Question 2

The investment approach that evaluates and interprets past share price movements is:

Accepted Answer

A)  credit analysis. 
B)  technical analysis. 
C)  fundamental analysis. 
D)  systematic analysis. 
A)  credit analysis. 
B)  technical analysis. 
C)  fundamental analysis. 
D)  systematic analysis.

Question 3

Firm-specific financial indicators used in fundamental analysis top-down approach are:

Accepted Answer

A)  interest rates. 
B)  consumer confidence. 
C)  return on assets. 
D)  business cycle. 
A)  interest rates. 
B)  consumer confidence. 
C)  return on assets. 
D)  business cycle.

Question 4

The portion of the overall economy defined by the nature of a company's operations is called the:

Accepted Answer

A)  economic component. 
B)  company component. 
C)  industry sector. 
D)  country sector. 
A)  economic component. 
B)  company component. 
C)  industry sector. 
D)  country sector.

Question 5

In relation to technical analysis,what is the level above which the market finds it difficult to rise?

Accepted Answer

A)  Trend channel 
B)  Resistance level 
C)  Support level 
D)  None of the given answers are correct 
A)  Trend channel 
B)  Resistance level 
C)  Support level 
D)  None of the given answers are correct

Question 6

An investor who buys a large number of shares from different companies and from many different industries will:

Accepted Answer

A)  abolish systematic risk. 
B)  minimise unsystematic risk. 
C)  minimise credit risk. 
D)  minimise price risk. 
A)  abolish systematic risk. 
B)  minimise unsystematic risk. 
C)  minimise credit risk. 
D)  minimise price risk.

Question 7

In relation to stock exchanges,the term 'flash trading' refers to:

Accepted Answer

A)  applications of high-speed supercomputers that can place thousands of orders in seconds and then immediately cancel them. 
B)  some institutional investors being able to place large buy orders without having to disclose the whole trade to the exchange. 
C)  pennants and flags patterns in very fast moving markets. 
D)  the trades of certain institutional investors that receive information from a stock exchange of incoming orders before other traders. 
A)  applications of high-speed supercomputers that can place thousands of orders in seconds and then immediately cancel them. 
B)  some institutional investors being able to place large buy orders without having to disclose the whole trade to the exchange. 
C)  pennants and flags patterns in very fast moving markets. 
D)  the trades of certain institutional investors that receive information from a stock exchange of incoming orders before other traders.

Question 8

In relation to behavioural finance,if an investor is influenced by the manner in which an investment opportunity is presented this is called:

Accepted Answer

A)  trading noise. 
B)  herding instinct. 
C)  framing behaviour. 
D)  disposition effect. 
A)  trading noise. 
B)  herding instinct. 
C)  framing behaviour. 
D)  disposition effect.

Question 9

In relation to technical analysis,a support level is:

Accepted Answer

A)  a level beyond which the market is unlikely to rise. 
B)  a level below which the market is unlikely to fall. 
C)  an equilibrium price level supported by earnings and cash flows. 
D)  the complete cycle of a market wave. 
A)  a level beyond which the market is unlikely to rise. 
B)  a level below which the market is unlikely to fall. 
C)  an equilibrium price level supported by earnings and cash flows. 
D)  the complete cycle of a market wave.

Question 10

The strong form of the efficient market hypothesis states that:

Accepted Answer

A)  security prices reflect all publicly available information. 
B)  major market events can be predicted using publicly available information. 
C)  insider information contains no special advantage. 
D)  future prices are predictable. 
A)  security prices reflect all publicly available information. 
B)  major market events can be predicted using publicly available information. 
C)  insider information contains no special advantage. 
D)  future prices are predictable.

Question 11

What is program trading in relation to the share market?
 Discuss any impact on share price movements.

Accepted Answer

Program trading refers to the use of com

Question 12

Some of the factors that are used by analysts using the top-down approach in the analysis of fundamentals affecting share prices are:

Accepted Answer

A)  exchange rates. 
B)  interest rates. 
C)  rate of growth in international economies. 
D)  all of the given answers. 
A)  exchange rates. 
B)  interest rates. 
C)  rate of growth in international economies. 
D)  all of the given answers.

Question 13

Program trading:

Accepted Answer

A)  is the most likely reason there was a stock market crash in October 1987. 
B)  occurs only in over-the-counter markets. 
C)  refers to computer-generated orders to buy or sell many shares at the same time. 
D)  has been abolished by order of the ASX. 
A)  is the most likely reason there was a stock market crash in October 1987. 
B)  occurs only in over-the-counter markets. 
C)  refers to computer-generated orders to buy or sell many shares at the same time. 
D)  has been abolished by order of the ASX.

Question 14

If a share price falls on four consecutive days of trading,share prices:

Accepted Answer

A)  cannot be following a random walk 
B)  can still be following a random walk 
C)  are almost certain to decrease the next day 
D)  are almost certain to increase the next day 
A)  cannot be following a random walk 
B)  can still be following a random walk 
C)  are almost certain to decrease the next day 
D)  are almost certain to increase the next day

Question 15

Writing down the value of a capital asset,reported as an expense,is called:

Accepted Answer

A)  downgrading. 
B)  depreciation. 
C)  documentation. 
D)  reduction. 
A)  downgrading. 
B)  depreciation. 
C)  documentation. 
D)  reduction.

Question 16

The investment approach that focuses more on past price movements of a company's stock than on the underlying determinants of future profitability is:

Accepted Answer

A)  credit analysis. 
B)  fundamental analysis. 
C)  systems analysis. 
D)  technical analysis. 
A)  credit analysis. 
B)  fundamental analysis. 
C)  systems analysis. 
D)  technical analysis.

The lower the degree of unsystematic risk,the:

The investment approach that evaluates and interprets past share price movements is:

Firm-specific financial indicators used in fundamental analysis top-down approach are:

The portion of the overall economy defined by the nature of a company's operations is called the:

In relation to technical analysis,what is the level above which the market finds it difficult to rise?

An investor who buys a large number of shares from different companies and from many different industries will:

In relation to stock exchanges,the term 'flash trading' refers to:

In relation to behavioural finance,if an investor is influenced by the manner in which an investment opportunity is presented this is called:

In relation to technical analysis,a support level is:

The strong form of the efficient market hypothesis states that:

What is program trading in relation to the share market? Discuss any impact on share price movements.

Some of the factors that are used by analysts using the top-down approach in the analysis of fundamentals affecting share prices are:

Program trading:

If a share price falls on four consecutive days of trading,share prices:

Writing down the value of a capital asset,reported as an expense,is called:

The investment approach that focuses more on past price movements of a company's stock than on the underlying determinants of future profitability is:

A Modern Financial System: An Overview

Commercial Banks

Non-Bank Financial Institutions

The Share Market and the Corporation

Corporations Issuing Equity in the Share Market

Investors in the Share Market

Mathematics of Finance: An Introduction to Basic Concepts and Calculations

Short-Term Debt

Medium-To-Long-Term Debt

International Debt Markets

Government Debt, monetary Policy and the Payments System

An Introduction to Interest Rate Determination and Forecasting

Interest Rate Risk

Foreign Exchange: The Structure and Operation of the Fx Market

Foreign Exchange: Factors That Influence the Exchange Rate

Foreign Exchange: Risk Identification and Management

An Introduction to Risk Management and Derivatives

Future Contracts and Forward Rate Agreements

Options

Interest Rate Swaps, Cross-Currency Swaps and Credit Default

Filters

Exam 7: Forecasting Share Price Movements

The lower the degree of unsystematic risk,the:

The investment approach that evaluates and interprets past share price movements is:

Firm-specific financial indicators used in fundamental analysis top-down approach are:

The portion of the overall economy defined by the nature of a company's operations is called the:

In relation to technical analysis,what is the level above which the market finds it difficult to rise?

An investor who buys a large number of shares from different companies and from many different industries will:

In relation to stock exchanges,the term 'flash trading' refers to:

In relation to behavioural finance,if an investor is influenced by the manner in which an investment opportunity is presented this is called:

In relation to technical analysis,a support level is:

The strong form of the efficient market hypothesis states that:

What is program trading in relation to the share market? Discuss any impact on share price movements.

Some of the factors that are used by analysts using the top-down approach in the analysis of fundamentals affecting share prices are:

Program trading:

If a share price falls on four consecutive days of trading,share prices:

Writing down the value of a capital asset,reported as an expense,is called:

The investment approach that focuses more on past price movements of a company's stock than on the underlying determinants of future profitability is:

A Modern Financial System: An Overview

Commercial Banks

Non-Bank Financial Institutions

The Share Market and the Corporation

Corporations Issuing Equity in the Share Market

Investors in the Share Market

Mathematics of Finance: An Introduction to Basic Concepts and Calculations

Short-Term Debt

Medium-To-Long-Term Debt

International Debt Markets

Government Debt, monetary Policy and the Payments System

An Introduction to Interest Rate Determination and Forecasting

Interest Rate Risk

Foreign Exchange: The Structure and Operation of the Fx Market

Foreign Exchange: Factors That Influence the Exchange Rate

Foreign Exchange: Risk Identification and Management

An Introduction to Risk Management and Derivatives

Future Contracts and Forward Rate Agreements

Options

Interest Rate Swaps, Cross-Currency Swaps and Credit Default

Filters