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Analysis- Series 7 Exam With Complete Solutions Latest Update
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Analysis- Series 7 Exam With CompleteSolutions Latest Update
Balance of Payments - ANSWER -Dividend payments by U.S. issuers to foreign holders
of those securities increase
-Exports of domestic goods to foreign countries decrease
-Imports of foreign goods into the United States increase
Effect of Changes on Currency Values - ANSWER -U.S. exports should decrease
-Any trade deficit should widen
-U.S. currency values will increase relative to that of foreign countries
-U.S. exports should become more expensive to foreign countries
-Depreciate goes down
-Appreciate goes up
Interbank Market - ANSWER -Foreign currencies trade in the interbank market
-Trading takes place 24 hours a day
-Trades settle on a spot or forward contract basis
-Trading is in large blocks
Trading Impact on Economy - ANSWER -Foreign Currency prices in terms of U.S. dollars
-Future trade deficit or surplus figures
-Future economic growth
-Foreign currency prices in terms of U.S. dollars
Spot settlement - ANSWER -A foreign currency trade that settles either 1 or 2 business
,days after trade date is a
Speculators in foreign currencies would be subject to all of the following risks -
ANSWER -Political risk
-Market risk
-Exchange rate risk
Central Bank Intervention - ANSWER -Undervalued, it will buy the currency in the
market through its central bank (buy its own currency)
-Overvalued, it will sell the currency in the market thru its central bank (sell its own
currency)
Actions That Will Affect Currency Values - ANSWER -Foreign investors purchase U.S.
securities
-The Federal Reserve raises the discount rate
If the dollar falls against foreign currencies, which of the following statements are TRUE
- ANSWER -Foreign currencies buy more dollars
-U.S. exports are likely to rise
-Foreign imports are likely to fall
- Foreign goods become more expensive in the U.S.
Items Affect Valuations (+) - ANSWER -Increasing capital gains tax rates
-Increasing employment rates
-Declining interest rates
Items Affect Valuations (-) - ANSWER -Increasing interest rates
, -Increasing capital gains tax rates
-Increasing inflation rates
Dow Jones Transportations Averages - ANSWER -20 stocks/ companies
The largest component of the Standard and Poor's 500 Average is the: - ANSWER
-Industrials
Which index is the narrowest measure of the market? - ANSWER -Dow Jones Industrial
Average
A resistance level is: - ANSWER -above the current market price of the stock
-a point through which the stock's price tends not to rise
If the price of a stock breaks out through the support level, it is expected that the stock's
price will: - ANSWER -fall
A head and shoulders "bottom" formation is: - ANSWER -bullish
-reverse downward trend
A head and shoulders "bottom" formation is a: - ANSWER -reverse downward trend
An inverted "saucer" formation is: - ANSWER -bearish
-reverse upward trend
An extended period where there is no discernible trend in prices is termed: - ANSWER
-consolidation
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