Exam 7: Risk and Returnan Introduction: History of Financial Market Returns

You purchased shares of Global Security at a price of $75.75 one-year ago today.If you sell the shares today for $89.00, what is your rate of return?

How much will Susan's shares be worth if she sells it five years from today?

If markets are efficient, share prices go up when there is positive information about a company, and go down when there is negative information about the company.

How much money did Kamal receive when he sold his shares of Oceanic Electric?

Which of the following is consistent with the semi-strong form efficient market hypothesis?

Over the period 1995-2015, which pair of investments does not perfectly fit the 'higher risk, higher return' pattern?

If an individual with inside information can make higher than expected profits, the market is no more than semi-strong form efficient.

Each of the following would tend to weaken the semi-strong form Efficient Market Hypothesis except

What is the geometric average return on Susan's shares if she sells it five years from today?

The traditional view of markets assumes that investors are [blank].

Even though an investor expects a positive rate of return, it is possible that the actual return will be negative.

Investments that have earned the highest rates of return over 1995-2015 also have [blank].

You have invested in a project that has the following payoff schedule: What is the expected value of the investment's payoff? (Round to the nearest $1.)

Investors are always rewarded for taking higher risk with higher realized returns.

Investments in emerging markets have higher volatility than do Australian shares.

Under the efficient market hypothesis, would securities be properly priced?

Less risky investments have lower standard deviations than do more risky investments.

Historically, including international shares in one's portfolio increases the portfolio's risk.

The higher the standard deviation, the less risk the investment has.

The variation in rates of return earned over a period of time is known as the investment's [blank].