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ABA CTFA Practice Test - Questions Answers, Page 74

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Apart from the balance sheet or retained earnings what else must the financial analyst take into consideration in fundamental analysis?

A.
The assortment track record
A.
The assortment track record
Answers
B.
The previous track record
B.
The previous track record
Answers
C.
The crowbar track record
C.
The crowbar track record
Answers
D.
The adviser track record
D.
The adviser track record
Answers
Suggested answer: B

Which of the following is an average signifying the point in time when the present value of security is repaid?

A.
Yield to maturity
A.
Yield to maturity
Answers
B.
Duration
B.
Duration
Answers
C.
Convexity
C.
Convexity
Answers
D.
Immunization
D.
Immunization
Answers
Suggested answer: B

Which of the following is a current market in which all buying and selling is done on cash or margin basis?

A.
Target market
A.
Target market
Answers
B.
Historic market
B.
Historic market
Answers
C.
Regular market
C.
Regular market
Answers
D.
Borough market
D.
Borough market
Answers
Suggested answer: C

Which of the following term is used synonymously for the equity?

A.
Share
A.
Share
Answers
B.
Distribution
B.
Distribution
Answers
C.
Section
C.
Section
Answers
D.
Division
D.
Division
Answers
Suggested answer: A

If the Dow Johns industrial average stock splits 3 for 1 then what impact will this have on the index divisor?

A.
Index divisor will incline
A.
Index divisor will incline
Answers
B.
Index divisor remains constant
B.
Index divisor remains constant
Answers
C.
Index divisor will decline
C.
Index divisor will decline
Answers
D.
Index divisor multiply
D.
Index divisor multiply
Answers
Suggested answer: C

The sensitivity of coupon price to change in its yield:

A.
Is directly related to the bond's yield
A.
Is directly related to the bond's yield
Answers
B.
Is inversely related to the bond's yield to maturity
B.
Is inversely related to the bond's yield to maturity
Answers
C.
Is greater for increases in yield to maturity than it is for decreases in yield to maturity
C.
Is greater for increases in yield to maturity than it is for decreases in yield to maturity
Answers
D.
Is constant regardless of whether the yield to maturity increases or decreases
D.
Is constant regardless of whether the yield to maturity increases or decreases
Answers
Suggested answer: A

Which of the following stage offers the highest potential returns and the greatest risk?

A.
Pioneering stage
A.
Pioneering stage
Answers
B.
Expansion stage
B.
Expansion stage
Answers
C.
Stabilization stage
C.
Stabilization stage
Answers
D.
Decline stage
D.
Decline stage
Answers
Suggested answer: A

Margin accounts are mostly used by:

A.
Traders who think that their long run returns will be greater than their cost of borrowing
A.
Traders who think that their long run returns will be greater than their cost of borrowing
Answers
B.
Speculators who think that their long run returns will be greater than the cost of borrowing
B.
Speculators who think that their long run returns will be greater than the cost of borrowing
Answers
C.
Investors who think that their long run returns will be greater than the cost of borrowing
C.
Investors who think that their long run returns will be greater than the cost of borrowing
Answers
D.
All of the above
D.
All of the above
Answers
Suggested answer: D

All of the following are the problem associated with the Dividend Discount Model Except:

A.
This model needs infinite stream of dividends
A.
This model needs infinite stream of dividends
Answers
B.
This model has uncertain dividend stream
B.
This model has uncertain dividend stream
Answers
C.
This model must estimate future dividends
C.
This model must estimate future dividends
Answers
D.
This model requires constant earnings per share
D.
This model requires constant earnings per share
Answers
Suggested answer: D

In which of the following accounts the trading charges are high?

A.
Savings account
A.
Savings account
Answers
B.
System account
B.
System account
Answers
C.
Personal account
C.
Personal account
Answers
D.
Cash account
D.
Cash account
Answers
Suggested answer: D
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