Quiz 5 (Chapter 6) PDF

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Quiz 5 (Chapter 6)...

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Dashboard / BUS329 Investment Analysis (tsa, 2020) / 5: Capital Allocation to Risky Assets 1 (Chap

Started on State Completed on Time taken Grade

Thursday, 24 September 2020, 9:50 PM Finished Thursday, 24 September 2020, 10:26 PM 35 mins 46 secs 14.00 out of 15.00 (93%)

Question 1 Correct

14. Capital allocation line (CAL) becomes --------- if the borrowing rate and lending rat

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Select one: a. Negatively sloped b. Kinked  c. Flat d. Steep

Question 2 Correct

1. _______ investors reject investment portfolios that are _______ or __________

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Select one: a. Portfolio, risky, low return b. Risk averse, risky, low return c. Portfolio, fair game, worse d. Risk averse, fair game, worse 

Question 3 Correct Mark 1.00 out of 1.00

12. Consider a risky portfolio, A, with an expected rate of return of 0.12 and a standa a given indierence curve. Which one of the following portfolios might lie on the sam averse investor?

Question 4 Correct Mark 1.00 out of 1.00

13. The tangency point between capital allocation line and indierence curve corres and standard deviation of

Select one: a. Maximum return portfolio b. Optimal risky portfolio c. Optimal complete portfolio  d. Minimum variance portfolio

Question 5 Correct Mark 1.00 out of 1.00

15. If the borrowing rate is higher than the lending rate, then the slope of the CAL in ----- than the slope of the borrowing region

Select one: a. Lower b. Flatter c. Higher  d. None of the above

Question 6 Correct

30. The value of risk aversion in utility function for risk-averse, risk-lover and risk-neu

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Select one: a. Less than zero, zero and greater than zero respectively b. Greater than zero, less than zero and zero respectively  c. Greater than zero, zero and less than zero respectively d. Zero, less than zero and greater than zero respectively

Question 8 Incorrect Mark 0.00 out of 1.00

19. An investor invests 30% of his wealth in a risky asset with an expected rate of ret deviation of 4% and 70% in a T-bill that pays 6%. The standard deviation of his portf

Select one: a. 6% b. 2.8% c. 1.2% d. 4% 

Question 9 Correct Mark 1.00 out

7. In the expected return-standard deviation plane, indierence curve is dened as t

of 1.00

Select one: a. Locus of portfolios that have the same standard deviations and dierent rat b. Locus of portfolios that have the same expected rates of return and dieren c. Combinations of portfolios with minimum risk and maximum return d. Locus of portfolios that oer the same utility according to returns and stand

Question 10 Correct Mark 1.00 out of 1.00

25. If you invest in virtually risk-free short-term T-bills and a fund of common stocks index, we can say that you are following:

Select one: a. Active strategy b. Passive strategy  c. Security analysis d. Aggressive strategy

Question 12 Correct

2. Which of the following statements is not TRUE?

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Select one: a. Risk averse investors consider only risk-free or speculative prospects with po b. Risk-averse investors do not penalize the expected rate of return of a risky p c. A portfolio is more attractive when its expected return is higher and its risk i d. None of the above.

Question 13 Correct

18. Given the capital allocation line, an investor's optimal portfolio is the portfolio th

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Select one: a. Maximises her expected prot b. Maximises risk c. Minimises both her risk and return d. Maximises her expected utility 

Question 14 Correct Mark 1.00 out of 1.00

6. In the expected return-standard deviation plane, the preferred direction is _______ simultaneously ___________ the expected return and _________ the volatility of the rate

Select one: a. Southwest, decrease, increase b. Northwest, decrease, increase c. Southwest, increase, decrease d. Northwest, increase, decrease 

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