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FIN 301 MIDTERM EXAM 2024/2025 VERIFIED QUESTIONS AND ANSWERS GRADED A+(SOLVED)
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FIN 301 MIDTERM EXAM 2024/2025 VERIFIED QUESTIONS AND ANSWERS GRADED A+(SOLVED)
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FIN 301 MIDTERM EXAM 2024/2025FIN 301 MIDTERM EXAM 2024/2025 VERIFIED
QUESTIONS AND ANSWERS GRADED
A+(SOLVED)
Small cap stocks are riskier than corporate bonds
true
investors believe that transaction costs, taxes, and inflation are the enemy bc they
reduce the return on your investments
true
the basic principles of finance dictate that in the short run, stock prices are driven
by
supply and demand
Which of the following would reduce returns of your investment portfolio
increase in brokerage commissions
,FIN 301 MIDTERM EXAM 2024/2025
if Apple's stock was at 260 a year ago and trades at 320 today and there was a $10
dividend, what is the return
320-260 + = 26.9%
If a stock is currently trading at 100 but a company says they will acquire that
company's stock for $120 then what will happen to the stock according to the
efficient market hypothesis
it will increase as soon as the announcement is made
what does the efficient market hypothesis say about using technical analysis to
forecast future stock prices
it is useless
If you invest in a stock with a beta of .7 you would expect your return to be
lower than that of the overall market
the random walk hypothesis states that
day to day stock prices move randomly and independently from one another
,FIN 301 MIDTERM EXAM 2024/2025
the primary business of Berkshire Hathaway is
insurance
inflation reduces your return by
reducing the value of the money you receive on the investment
risk aversion means
investors take small risks but do not avoid risk at all costs
behavioral finance believes that
markets are not always efficient
to achieve the highest level of return you have to
diversify your investment into different asset classes
long run stock prices are driven by
corporate earnings
, FIN 301 MIDTERM EXAM 2024/2025
What do behavioral financiers not believe
that decision makers make rational decisions that maximize utility
what is a up front cost of 5% an example of
transaction cost
management must act in whose interest
shareholders
which stock is less risky? biotech or utility
utility
the basic principles of finance dictate that in the short run, stock prices are driven
by
supply and demand
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