Fight Finance

(a) ##\sigma_\text{yearly}^2 = \sigma_\text{monthly}^2##

(b) ##\sigma_\text{yearly}^2 = \sigma_\text{monthly}^2 \times 12##

(c) ##\sigma_\text{yearly}^2 = \sigma_\text{monthly}^2 \times 12^2##

(d) ##\sigma_\text{yearly}^2 = \sigma_\text{monthly}^2 \times \sqrt{12}##

(e) ##\sigma_\text{yearly}^2 = \sigma_\text{monthly}^2 \times {12}^{1/3}##

(a) Short term debt denominated in USD, for example lending to a US bank as a USD deposit.

(b) Long term debt denominated in USD, for example lending to a US company by buying their USD bonds.

(c) Shares denominated in USD, for example buying shares in Coca-Cola which is listed on the NYSE.

(d) Real estate denominated in USD, for example buying an apartment in Chicago.

(e) Commodities with USD, for example buying gold, wheat, or coal.

(a) ##\max(S_T - K, 0)##.

(b) ##\max(S_T - K, K)##.

(c) ##\max(K-S_T, 0)##.

(d) ##\max(K-S_T, K)##.

(e) ##\min(K-S_T, 0)##.

(a) The firm's enterprise value is less than its total asset value.

(b) The firm's enterprise value beta is higher than the total asset value beta.

(c) The enterprise value's weighted average cost of capital (WACC) is higher than the total asset value's WACC.

(d) The enterprise value divided by the number of shares equals the share price.

(e) The total asset value less the market value of debt, all divided by the number of shares, equals the share price.

(a) 1.55 USD per GBP

(b) 120.61 JPY per USD

(c) 6.32 RMB per USD

(d) 1 USD = 1.31 CAD

(e) 0.99 CHF = 1 USD

(a) ##f_{SC,T}=max⁡(S_T-X_T,0)##

(b) ##f_{SC,T}=max⁡(X_T-S_T,0)##

(c) ##f_{SC,T}=-max⁡(S_T-X_T,0)##

(d) ##f_{SC,T}=-max⁡(X_T-S_T,0)##

(e) ##f_{SC,T}=min⁡(X_T-S_T,0)##

(a) Net income, depreciation and interest expense.

(b) Depreciation and capital expenditure.

(c) Current assets and current liabilities.

(d) Current assets, current liabilities and capital expenditure.

(e) Current assets, current liabilities and depreciation expense.

(a) Higher debt leads to higher interest expense.

(b) Higher interest expense leads to lower profit before tax, following on from above.

(c) Lower profit before tax leads to lower tax payments, following on from above.

(d) Lower tax payments lead to higher cash flow from assets, following on from above.

(e) Lower profit after tax leads to a lower share price, following on from above.

(a) Current deposits are the notes and coins that banks keep in their physical vaults and Automatic Teller Machines (ATM’s).

(b) Current deposits with banks pay little interest to depositors but are highly liquid since they can be withdrawn using ATM’s.

(c) The government directly controls the amount of notes and coins.

(d) The central bank indirectly controls the amount of deposits by changing the cash rate.

(e) When a commercial bank lends money to a borrower to buy a house, that money is likely to be deposited by the house seller into another bank.

(a) The IRR of the company’s new project.

(b) The required return of the company’s new project.

(c) The IRR of the company’s assets.

(d) The required return of the company’s assets.

(e) The IRR of the company’s equity.