1) A stock’s beta value in statistical term is:

a. its measure of diversifiable risk.

b. The vitality of the asset in relation to the market.

c. measure of acceptable risk in relation to the risk- free rate.

d. Its measure of marketability with regard to earnings per share.

2. Attractive value stocks feature:

a. Rapid historical EPS growth

b. Rapid expected EPS growth

c. Above average P/E ratios.

d. Below average P/B ratios

3. Value investing always involves:

a. Focusing only on securities considered to be temporarily overvalued or popular for various reasons.

b. Seeking bargain described in terms of a market price that is below the economic value of assets in place

c. Focusing on companies expected to have above average rates of the growth in earnings and dividends.

d. Finding bargains selling at prices below their actual market price.

4. The feature of a well-functioning investment industry that gives investors the ability to quickly buy and sell a significant amount of an investment without having a material impact on the price is described as :

a. Liquidity

b. Competitive markets

c. Risk transfer

5. Which of the following securities trade in the money market?

a. T-bills

b. Commercial paper

c. Bankers acceptances

d. All are correct

6. The best financial statement used to find information about the company owns and owes others is called the :

a. Income statement

b. Balance sheet

c. Cash flow statement

7. if a company is liquidated, proceeds from asset sales are distributed to common shareholders:

A) before unsecured debt investor and preferred shareholder claims are paid

B) after secured debt investor and preferred shareholder claims are paid

C) after preferred shareholder claims are paid but before unsecured debt investor claims are paid.

8. Which of the following is a direct investment?

a) a private investment trusts.

b) a mutual fund

c) a common stock

d) a financial future