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Exam of 5 pages for the course BMC at BMC (BMC Quiz)
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BMC QuizWhat is the most common measure central banks seek to target directly? A. GDP growth B. Stock market C. Inflation D. Money Supply - answer C. Inflation
GDP per capita is a measure of prosperity because it divides the total GDP of a country by its population. Which of the below forecasts for a country would result in the highest GDP per capita growth? A. An increase of 4% in GDP and a population decline of 1% B. An increase of 0% in GDP and a population decline of 2% C. An increase of 4% in GDP and a population growth of 1% D. An increase of 4% in GDP and a population growth of 2% - answer A. An increase
of 4% in GDP and a population decline of 1%
Which of the following qualities of economic indicators do investors prize the most? A. Rigor B. Sample Size C. Timeliness of Release D. Government Source - answer C. Timeliness of Release
Which of the following economic indicators is most directly linked to the average person's cost of living? A. GDP B. PMI C. CPI D. Nonfarm payrolls - answer C. CPI
What is the main reason that investment banks create estimates of economic indicators? A. To hold governments accountable for management of their economies. B. To know when specific economic data points are a positive or negative surprise. C. To increase real GDP growth by exporting their intellectual property to foreign investors. D. To determine in which countries the banks should operate - answer B. To know when specific economic data points are a positive or negative surprise
Which of the following is the biggest disadvantage of economic indicators? A. They are generated by sources with their own biases and agenda. B. They do not employ a statistically relevant sample size. C. They only serve as proxies for economic activity. D. They are not sufficiently timely to make informed investment decisions - answer D. They are not sufficiently timely to make informed investment decisions
What does the Big Mac index show?
A. How currencies may be over/under valued. B. How the Economist magazine estimates inflation. C. How interest rates and inflation affect trade. D. How the law of one price is true of consumer products - answer A. How currencies may be over/under valued
If the below companies are otherwise identical, which one would you invest in? A. Company A's stock that increases 1% plus the inflation every year. B. Company B that pays a dividend of 2%. C. Company C which pays 3% dividend every year and its stock price decreases by 2% a year.
D. Company D that pays no dividends, and stock price remain unchanged - answer A. Company A's stock that increases 1% plus the inflation every year
Why are equities volatile? A. Due to changing tax rates. B. Due to residual nature of earnings.
C. Due to varying supply of, and demand for, IPO. D. Due to low levels of borrowing - answer B. Due to residual nature of earnings
Which of the following statement is true, regarding the release of earnings announcements, and the release of economic indicators?
A. Both are released regularly by the central bank. B. Both are typically released on a quarterly basis. C. Both are typically published by corporations. D. Both are scheduled in advance - answer D. Both are scheduled in advance
When an analyst is looking at a company for the first time, which of the following four activities does he do first? A. Estimates the breakdown of the company's cost base.
B. Calculate the company's market share or market shares. C. Defines the industry or industries in which the company operates.
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