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Finding assets whose returns are perfectly negatively correlated
Building a portfolio of assets whose returns move together
Investing in bonds and avoiding stocks during bad times
Adding assets to a portfolio that move independently

Question # 10 of 15 ( Start time: 11:53:55 PM ) Total Marks: 1
Which of the following would be considered characteristic of money? 
Select correct option:

It is store of value
It pays a higher return than most assets
It is in fixed supply
It is legal tender everywhere in the world

Answer=1

Question # 11 of 15 ( Start time: 11:54:31 PM ) Total Marks: 1
Which one of the following is the strategy of reducing overall risk by making two investments which are totally independent of each other? 
Select correct option:

Spreading the risk
Standard deviation
Hedging the risk
Variance

Answer=3

Question # 12 of 15 ( Start time: 11:55:12 PM ) Total Marks: 1
Which one of the following is a component of wealth that is held in a readily spendable form? 
Select correct option:

Money
Bonds
Stocks
Income

Answer=2

Question # 13 of 15 ( Start time: 11:55:38 PM ) Total Marks: 1
If YTM is greater than the coupon rate the price of the bond is ________. 
Select correct option:

Greater than its face value
Lower than its face value
Equals to its face value
All of the given options

Question # 5 of 15 ( Start time: 12:10:18 AM ) Total Marks: 1
Which of the following would be included in a definition of risk? 
Select correct option:
Risk is a not measure of uncertainty
Risk is unavoidable
Risk doesn't have a time horizon
Risk seldom involves some future payoff

Answer=1

Question # 6 of 15 ( Start time: 12:11:38 AM ) Total Marks: 1
Which one of the following is the strategy of reducing overall risk by making two investments which are totally independent of each other? 
Select correct option:
Spreading the risk
Standard deviation
Hedging the risk
Variance

Question # 11 of 15 ( Start time: 12:16:39 AM ) Total Marks: 1
Diversification is the principle of:
Select correct option:
Holding more than one risk at a time
Reducing the risks we carry to just two
Creating risk to increase returns
Eliminating investments from our portfolio that have idiosyncratic risk

of the following best expresses the payment a lender receives for lending their money for four years? 
Select correct option:

PV(1+i)4
PV/(1 + i)4
4PV
PV/(1 - i)4
Answer=1

If YTM is greater than the coupon rate the price of the bond is ________. 
Select correct option:

Greater than its face value
Lower than its face value
Equals to its face value
All of the given options
Answer=2

Which of the following best describes checks? 
Select correct option:

A means of payment
Money
Not a promise of any kind
Not acceptable by the U.S. Government for payment of taxes. 
Answer=1

longer the time (n) until the payment:
Select correct option:

The lower the present value
The higher the present value because time is valuable
The lower must be the interest rate
Time has no effect on present value
Answer=2

Which of the following expresses 6.5%? 
Select correct option:

0.0065
6.50
0.650
0.0650

Answer=2

The price of a coupon bond can best be described as:
Select correct option:

The present value of the face value
The future value of the coupon payments and the face value
The present value of the coupon payments
Both The present value of the face value and of the coupon payments
Answer=4

Spreading involves:
Select correct option:

Finding assets whose returns are perfectly negatively correlated
Building a portfolio of assets whose returns move together
Investing in bonds and avoiding stocks during bad times
Adding assets to a portfolio that move independently
Answer=4

Which of the following best expresses the proceeds a lender receives from a simple loan? 
Select correct option:

PV(1 + i)
FV/i
PV + i
PV/i
Answer=1

The return on the bond is equal to which of the following? 
Select correct option:

Which of the following financial instruments used primarily as store of value? 
Select correct option:

Options
Stocks
Home mortgage
Bonds

Answer=4

Question # 3 of 15 ( Start time: 12:49:28 AM ) Total Marks: 1
Which of the following best represent the true relationships between interest rates and bond prices? 
Select correct option:

Move in the same direction
Move in opposite direction

Answer=2

Question # 6 of 15 ( Start time: 12:52:07 AM ) Total Marks: 1
Which one of the following is the strategy of reducing overall risk by making two investments which are totally independent of each other? 
Select correct option:

Spreading the risk
Standard deviation
Hedging the risk
Variance

Answer=3

Question # 7 of 15 ( Start time: 12:52:36 AM ) Total Marks: 1
The relationship between the price and the interest rate for a zero coupon bond is best described as:
Select correct option:

Does not pay any coupon payments because the issuer is in default
Pays coupons only once a year versus the usual twice a year
Promises a single future payment
Pays coupons only if the bond price is below face value

Answer=3

Question # 13 of 15 ( Start time: 01:05:49 AM ) Total Marks: 1
When the auto manufacturing industry does poorly due to a recession this is an example of:
Select correct option:

Question # 11 of 15 ( Start time: 01:13:54 AM ) Total Marks: 1
Mr A need 1000000 to buy a car for his personal use he contact with bank that give his loan this would be called
Select correct option:
Direct finance
Indirect finance
Facilitate payment
All of above
Answer=1

Question # 12 of 15 ( Start time: 01:14:24 AM ) Total Marks: 1
Which of the following best expresses the proceeds a lender receives from a simple loan? 
Select correct option:
PV(1 + i)
FV/i
PV + i
PV/i
Answer=1
Question # 13 of 15 ( Start time: 01:15:02 AM ) Total Marks: 1
What will be the result of the difference of real and nominal interest rate? 
Select correct option:
The cost of borrowing
The effect of inflation
The price of bonds
The return of bonds
Answer=2
Question # 14 of 15 ( Start time: 01:15:43 AM ) Total Marks: 1
Which of the following institution take direct deposit from customer and give loan to customer directly? 
Select correct option:
Zarai Tarkaytee Bank LTD
Soneri Bank
Khushali Bank
Credit union
Answer=4

Check is cleared from bank but warrant is not cleared by bank
Check is not necessarily pay able on demand but warrant is payable on demand
Warrant is not necessarily pay able on demand but check is payable on demand
None of above

Answer=3

Question # 6 of 15 ( Start time: 01:20:22 AM ) Total Marks: 1
A ________ is a promise to make a series of payments on specific future date. 
Select correct option:

Always prefer an investment with a lower expected return
Always prefer an investment with a certain return to one with the same expected return but any amount of uncertainty
Always require a certain return
Always focus exclusively on the expected return

Question # 2 of 15 ( Start time: 01:24:54 AM ) Total Marks: 1
Core principles of Money and Banking include each of the following except? 
Select correct option:
People act rationally
Time has value
Information is the basis for decisions
Risk requires compensation

Answer=2

Question # 3 of 15 ( Start time: 01:25:13 AM ) Total Marks: 1
One of major disadvantage of fiat money is
Select correct option:
Only few resources are needed
It may be theft easily
Normally it is obsolete quickly
Pressure or corrupt government may print excessive money

Answer=4

Question # 4 of 15 ( Start time: 01:25:53 AM ) Total Marks: 1
Mr A need 1000000 to buy a car for his personal use he contact with bank that give his loan this would be called
Select correct option:
Direct finance
Indirect finance
Facilitate payment
All of above

Question # 6 of 15 ( Start time: 01:26:27 AM ) Total Marks: 1
Which of the following best describes the relationship between Bond prices and yields? 
Select correct option:
Move together inversely
Bond yields do not change since the coupon is fixed
Move together directly
Are independent of each other

Answer=1

Question # 7 of 15 ( Start time: 01:26:57 AM ) Total Marks: 1
Which characteristic are common both in money and securities
Select correct option:
Transfer of risk, store of value
Unit of account, mean of payment
Mean of payment, transfer of risk
Store of value, mean of payment

Answer=4

Question # 8 of 15 ( Start time: 01:27:35 AM ) Total Marks: 1
Which one of the following is the narrowest definition of money? 
Select correct option:
C
M1
M2
M3

Question # 10 of 15 ( Start time: 01:28:16 AM ) Total Marks: 1
A financial instrumnet in which a borrower obtains resources from a lender immediately in exchange for a promised set of payments in the future is called as _________. 
Select correct option:
Bond
Bank Loan
Home Mortgage
Futures Contract

Question # 13 of 15 ( Start time: 01:29:11 AM ) Total Marks: 1
What will be the effect on the present value if we double the future value of the payment? 
Select correct option:
It will decrease the value by one-half
It will increase the value by one-half
It will equally increase the value i.e. doubles the value
It will have no effect on the value

Answer=3

Question # 14 of 15 ( Start time: 01:30:03 AM ) Total Marks: 1
Which one of the following is the procedure of finding out the Present Value (PV)? 
Select correct option:
Discounting
Compounding
Time value of money
Bond pricing

Answer=1

Question # 15 of 15 ( Start time: 01:30:20 AM ) Total Marks: 1
A loan that is used to purchase the real estate is known as:
Select correct option:
Real estate loan
Home mortgages
Fixed payment loan
Home loan

Answer=3

Question # 2 of 15 ( Start time: 01:38:29 AM ) Total Marks: 1
Which characteristic are common both in money and securities
Select correct option:

Transfer of risk, store of value
Unit of account, mean of payment
Mean of payment, transfer of risk
Store of value, mean of payment
Answer=4

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