Exam 12: Some Lessons From Capital Market History

A stock has annual returns of 5 percent,21 percent,-12 percent,7 percent,and -6 percent for the past five years.The arithmetic average of these returns is _ percent while the geometric average return for the period is _ percent.

(Multiple Choice)

4.8/5

(68)

Question 21

Which one of the following is a correct ranking of securities based on their volatility over the period of 1926-2010? Rank from highest to lowest.

(Multiple Choice)

4.7/5

(72)

Question 22

Assume that the market prices of the securities that trade in a particular market fairly reflect the available information related to those securities.Which one of the following terms best defines that market?

(Multiple Choice)

4.9/5

(77)

Question 23

Calculate the standard deviation of the following rates of return:

(Multiple Choice)

4.9/5

(79)

Question 24

The excess return is computed as the:

(Multiple Choice)

4.9/5

(70)

Question 25

Inside information has the least value when financial markets are:

(Multiple Choice)

4.9/5

(66)

Question 26

The real rate of return on a stock is approximately equal to the nominal rate of return:

(Multiple Choice)

4.9/5

(76)

Question 27

Which one of the following best defines the variance of an investment's annual returns over a number of years?

(Multiple Choice)

4.8/5

(85)

Question 28

Which of the following statements related to market efficiency tend to be supported by current evidence? I.Markets tend to respond quickly to new information. II.It is difficult for investors to earn abnormal returns. III.Short-run prices are difficult to predict accurately based on public information. IV.Markets are most likely weak form efficient.

(Multiple Choice)

4.8/5

(86)

Question 29

Standard deviation is a measure of which one of the following?

(Multiple Choice)

4.8/5

(75)

Question 30

One year ago,you purchased a stock at a price of $33.49.The stock pays quarterly dividends of $0.20 per share.Today,the stock is selling for $28.20 per share.What is your capital gain on this investment?

(Multiple Choice)

4.9/5

(79)

Question 31

A stock has annual returns of 6 percent,14 percent,-3 percent,and 2 percent for the past four years.The arithmetic average of these returns is _ percent while the geometric average return for the period is _ percent.

(Multiple Choice)

4.9/5

(79)

Question 32

The primary purpose of Blume's formula is to:

(Multiple Choice)

4.8/5

(70)

Question 33

Today,you sold 200 shares of Indian River Produce stock.Your total return on these shares is 6.2 percent.You purchased the shares one year ago at a price of $31.10 a share.You have received a total of $100 in dividends over the course of the year.What is your capital gains yield on this investment?

(Multiple Choice)

4.8/5

(74)

Question 34

Which one of the following statements is correct concerning market efficiency?

(Multiple Choice)

4.9/5

(83)

Question 35

Which one of the following statements related to capital gains is correct?

(Multiple Choice)

5.0/5

(80)

Question 36

Stacy purchased a stock last year and sold it today for $3 a share more than her purchase price.She received a total of $0.75 in dividends.Which one of the following statements is correct in relation to this investment?

(Multiple Choice)

4.8/5

(76)

Question 37

The return earned in an average year over a multi-year period is called the _____ average return.

(Multiple Choice)

4.8/5

(73)

Question 38

Which one of the following categories of securities had the lowest average risk premium for the period 1926-2010?

(Multiple Choice)

4.9/5

(71)

Question 39

Which one of the following correctly describes the dividend yield?

(Multiple Choice)

4.7/5

(81)

Question 40

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Exam 12: Some Lessons From Capital Market History

A stock has annual returns of 5 percent,21 percent,-12 percent,7 percent,and -6 percent for the past five years.The arithmetic average of these returns is _____ percent while the geometric average return for the period is _____ percent.

Which one of the following is a correct ranking of securities based on their volatility over the period of 1926-2010? Rank from highest to lowest.

Assume that the market prices of the securities that trade in a particular market fairly reflect the available information related to those securities.Which one of the following terms best defines that market?

Calculate the standard deviation of the following rates of return:

The excess return is computed as the:

Inside information has the least value when financial markets are:

The real rate of return on a stock is approximately equal to the nominal rate of return:

Which one of the following best defines the variance of an investment's annual returns over a number of years?

Standard deviation is a measure of which one of the following?

One year ago,you purchased a stock at a price of $33.49.The stock pays quarterly dividends of $0.20 per share.Today,the stock is selling for $28.20 per share.What is your capital gain on this investment?

A stock has annual returns of 6 percent,14 percent,-3 percent,and 2 percent for the past four years.The arithmetic average of these returns is _____ percent while the geometric average return for the period is _____ percent.

The primary purpose of Blume's formula is to:

Today,you sold 200 shares of Indian River Produce stock.Your total return on these shares is 6.2 percent.You purchased the shares one year ago at a price of $31.10 a share.You have received a total of $100 in dividends over the course of the year.What is your capital gains yield on this investment?

Which one of the following statements is correct concerning market efficiency?

Which one of the following statements related to capital gains is correct?

Stacy purchased a stock last year and sold it today for $3 a share more than her purchase price.She received a total of $0.75 in dividends.Which one of the following statements is correct in relation to this investment?

The return earned in an average year over a multi-year period is called the _____ average return.

Which one of the following categories of securities had the lowest average risk premium for the period 1926-2010?

Which one of the following correctly describes the dividend yield?

Introduction to Corporate Finance

Financial Statements, Taxes, and Cash Flow

Working With Financial Statements

Long-Term Financial Planning and Growth

Introduction to Valuation: The Time Value of Money

Discounted Cash Flow Valuation

Interest Rates and Bond Valuation

Stock Valuation

Net Present Value and Other Investment Criteria

Making Capital Investment Decisions

Project Analysis and Evaluation

Return, Risk, and the Security Market Line

Cost of Capital

Raising Capital

Financial Leverage and Capital Structure Policy

Dividends and Payout Policy

Short-Term Finance and Planning

Cash and Liquidity Management

Credit and Inventory Management

International Corporate Finance

Behavioral Finance: Implications for Financial Management

Enterprise Risk Management

Options and Corporate Finance

Option Valuation

Mergers and Acquisitions

Leasing

Filters

A stock has annual returns of 5 percent,21 percent,-12 percent,7 percent,and -6 percent for the past five years.The arithmetic average of these returns is _ percent while the geometric average return for the period is _ percent.

A stock has annual returns of 6 percent,14 percent,-3 percent,and 2 percent for the past four years.The arithmetic average of these returns is _ percent while the geometric average return for the period is _ percent.