Top 350+ Solved Investment Management MCQ Questions Answer
Q. The risk-free security has a beta equal to , while the market portfolio's beta is equal to
a. one; more than one.
b. one; less than one.
c. zero; one.
d. less than zero; more than zero.
Q. Beta is the slope of
a. the security market line.
b. the capital market line.
c. a characteristic line.
d. the CAPM.
Q. A measure of "risk per unit of expected return."
a. standard deviation
b. coefficient of variation
c. correlation coefficient
d. beta
Q. Which of the following securities have potentially the highest risk level, and also have the highest potential return?
a. Commercial paper
b. Bonds
c. Preferred stocks
d. Derivative securities
Q. The feasibility of converting an asset quickly and without significantly affecting its price is called:
a. divisibility
b. marketability
c. liquidity
d. low risk
Q. The price of a T-bill today is $97 and its maturity value is $100. The maturity is 6 months from now.
a. The dollar return to the investor would be $1 if held to maturity
b. The investor cannot lose money, but its earnings are not known before the maturity date
c. The dollar return to the investor would be $3 if the T-bill is held to maturity
d. The investor can lose money on these T-bills if held to maturity
Q. Blue chip stocks:
a. are common stocks of large, financially sound corporations with a good history of dividend payments and consistent earnings growth
b. are common stocks of medium-size firms having earnings growth in excess of the industry average
c. have high growth potential but are very risky
d. tend to do well in recessionary periods, but do not do well when the economy is booming
Q. A ____________________ represents part ownership in a public firm.
a. cumulative preferred stock
b. preference share
c. call option
d. common stock
Q. Variance calculation and measuring the Standard deviation is one way of measuring the______
a. Risk
b. Return
c. Speculation
d. Gambling
Q. Labour strike, consumer preferences and management policies are making to arises out ofuncertainty is known as ____________
a. Financial Risk
b. Business Risk
c. Unsystematic Risk
d. Systematic Risk
Q. Horse racing, game of cards, lottery are the typical examples of ______________
a. Investment
b. Speculation
c. Gambling
d. Arbitrage
Q. Buying low and selling high, making a large capital gain is associated with ________
a. Investment
b. Speculation
c. Gambling
d. Arbitrage
Q. The process of holding shares in electronic form is known as
a. Demutualisation
b. Dematerialisation
c. Speculation
d. None of the above
Q. ___ is the market which helps existing investors to sell their securities.
a. Primary market
b. Secondary market
c. Capital market
d. Commodity market
Q. An order to buy or sell a specified quantity of a stock at a specified price or better is called a
a. day order
b. market order
c. stop order
d. not-held order
e. limit order