You have been given this probability distribution for the holding-period return for a stock: $\begin{array}{lll} \underline{\text { State of the Economy} } &\underline{ \text { Probability} } & \underline{\text { HPR } }\\ \text { Boom } & .40 & 22\% \\ \text { Normal growth } & .35 & 11\%\\ \text { Recession } & .25 & -9 \% \end{array}$ -What is the expected holding-period return for the stock?

A) 11.67% B) 8.33% C) 9.56% D) 12.4% E) None of the above A) 11.67% B) 8.33% C) 9.56% D) 12.4% E) None of the above

You have been given this probability distribution for the holding-period return for KMP stock: $\begin{array}{lll} \underline{\text { State of the Economy }} & \underline{\text { Probability }} &\underline{ \text { HPR } }\\ \text { Boom } & .30 & 18\% \\ \text { Normal growth } & .50 & 12\%\\ \text { Recession } & .20 & -5\% \end{array}$ -What is the expected variance for KMP stock?

A) 66.04% B) 69.96% C) 77.04% D) 63.72% E) 78.45% A) 66.04% B) 69.96% C) 77.04% D) 63.72% E) 78.45%

Exam 5: Introduction to Risk,return,and the Historical Record

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Over the past year you earned a nominal rate of interest of 3.6 percent on your money.The inflation rate was 3.1 percent over the same period.The exact actual growth rate of your purchasing power was

(Multiple Choice)

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Question 61

If a distribution has "fat tails" it exhibits

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Question 62

When a distribution is positively skewed,____________.

(Multiple Choice)

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Question 63

You purchased a share of CSCO stock for $20.One year later you received $2 as a dividend and sold the share for $31.What was your holding-period return?

(Multiple Choice)

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Question 64

You have been given this probability distribution for the holding-period return for a stock: Boom .40 22\% Normal growth .35 11\% Recession .25 -9\% -What is the expected holding-period return for the stock?

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Question 65

If the annual real rate of interest is 2.5% and the expected inflation rate is 3.7%,the nominal rate of interest would be approximately

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Question 66

An investment provides a 2.1% return quarterly,its effective annual rate is

(Multiple Choice)

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Question 67

Skewness is a measure of ____________.

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Question 68

Historical records regarding return on stocks,Treasury bonds,and Treasury bills between 1926 and 2009 show that

(Multiple Choice)

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Question 69

A year ago,you invested $2,500 in a savings account that pays an annual interest rate of 2.5%.What is your approximate annual real rate of return if the rate of inflation was 3.4% over the year?

(Multiple Choice)

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Question 70

You purchased a share of stock for $20.One year later you received $1 as a dividend and sold the share for $29.What was your holding-period return?

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Question 71

Kurtosis is a measure of ____________.

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Question 72

If a portfolio had a return of 12%,the risk free asset return was 4%,and the standard deviation of the portfolio's excess returns was 25%,the Sharpe measure would be _____.

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Question 73

________ is a risk measure that indicates vulnerability to extreme negative returns.

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Question 74

You purchased a share of stock for $120.One year later you received $1.82 as a dividend and sold the share for $136.What was your holding-period return?

(Multiple Choice)

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Question 75

The historical arithmetic rate of return on U.S.small stocks over the 1926-2009 period has been _.The standard deviation of small stocks' returns has been __ than the standard deviation of large stocks' returns.

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Question 76

You purchased a share of stock for $65.One year later you received $2.37 as a dividend and sold the share for $63.What was your holding-period return?

(Multiple Choice)

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Question 77

You have been given this probability distribution for the holding-period return for KMP stock: Boom .30 18\% Normal growth .50 12\% Recession .20 -5\% -What is the expected variance for KMP stock?

(Multiple Choice)

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Question 78

If the annual real rate of interest is 2.5% and the expected inflation rate is 3.4%,the nominal rate of interest would be approximately

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Question 79

A year ago,you invested $1,000 in a savings account that pays an annual interest rate of 4%.What is your approximate annual real rate of return if the rate of inflation was 2% over the year?

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Question 80

Showing 61 - 80 of 86

Exam 5: Introduction to Risk,return,and the Historical Record

Over the past year you earned a nominal rate of interest of 3.6 percent on your money.The inflation rate was 3.1 percent over the same period.The exact actual growth rate of your purchasing power was

If a distribution has "fat tails" it exhibits

When a distribution is positively skewed,____________.

You purchased a share of CSCO stock for $20.One year later you received $2 as a dividend and sold the share for $31.What was your holding-period return?

You have been given this probability distribution for the holding-period return for a stock: Boom .40 22\% Normal growth .35 11\% Recession .25 -9\% -What is the expected holding-period return for the stock?

If the annual real rate of interest is 2.5% and the expected inflation rate is 3.7%,the nominal rate of interest would be approximately

An investment provides a 2.1% return quarterly,its effective annual rate is

Skewness is a measure of ____________.

Historical records regarding return on stocks,Treasury bonds,and Treasury bills between 1926 and 2009 show that

A year ago,you invested $2,500 in a savings account that pays an annual interest rate of 2.5%.What is your approximate annual real rate of return if the rate of inflation was 3.4% over the year?

You purchased a share of stock for $20.One year later you received $1 as a dividend and sold the share for $29.What was your holding-period return?

Kurtosis is a measure of ____________.

If a portfolio had a return of 12%,the risk free asset return was 4%,and the standard deviation of the portfolio's excess returns was 25%,the Sharpe measure would be _____.

________ is a risk measure that indicates vulnerability to extreme negative returns.

You purchased a share of stock for $120.One year later you received $1.82 as a dividend and sold the share for $136.What was your holding-period return?

The historical arithmetic rate of return on U.S.small stocks over the 1926-2009 period has been _______.The standard deviation of small stocks' returns has been ________ than the standard deviation of large stocks' returns.

You purchased a share of stock for $65.One year later you received $2.37 as a dividend and sold the share for $63.What was your holding-period return?

You have been given this probability distribution for the holding-period return for KMP stock: Boom .30 18\% Normal growth .50 12\% Recession .20 -5\% -What is the expected variance for KMP stock?

If the annual real rate of interest is 2.5% and the expected inflation rate is 3.4%,the nominal rate of interest would be approximately

A year ago,you invested $1,000 in a savings account that pays an annual interest rate of 4%.What is your approximate annual real rate of return if the rate of inflation was 2% over the year?

The Investment Environment

Asset Classes and Financial Instruments

How Securities are Traded

Mutual Funds and Other Investment Companies

Risk Aversion and Capital Allocation to Risky Assets

Optimal Risky Portfolios

Index Models

The Capital Asset Pricing Model

Arbitrage Pricing Theory and Multifactor Models of Risk and Return

The Efficient Market Hypothesis

Behavioral Finance and Technical Analysis

Empirical Evidence on Security Returns

Bond Prices and Yields

The Term Structure of Interest Rates

Managing Bond Portfolios

Options Markets: Introduction

Option Valuation

Futures Markets

Futures, swaps, and Risk Management

Macroeconomic and Industry Analysis

Equity Valuation Models

Financial Statement Analysis

Portfolio Performance Evaluation

International Diversification

Hedge Funds

The Theory of Active Portfolio Management

Investment Policy and the Framework of the CFA Institute Appendices

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The historical arithmetic rate of return on U.S.small stocks over the 1926-2009 period has been _.The standard deviation of small stocks' returns has been __ than the standard deviation of large stocks' returns.