Diversification is achieved by investing in a large amount of stocks. What type of risk is reduced by diversification?
A firm changes its capital structure by issuing a large amount of debt and using the funds to repurchase shares. Its assets are unchanged. Ignore interest tax shields.
According to the Capital Asset Pricing Model (CAPM), which statement is correct?
Why is Capital Expenditure (CapEx) subtracted in the Cash Flow From Assets (CFFA) formula?
###CFFA=NI+Depr-CapEx - \Delta NWC+IntExp###
Select the most correct statement from the following.
'Chartists', also known as 'technical traders', believe that:
There are many ways to write the ordinary annuity formula.
Which of the following is NOT equal to the ordinary annuity formula?
A European put option will mature in ##T## years with a strike price of ##K## dollars. The underlying asset has a price of ##S## dollars.
What is an expression for the payoff at maturity ##(f_T)## in dollars from owning (being long) the put option?
Question 737 financial statement, balance sheet, income statement
Where can a publicly listed firm's book value of equity be found? It can be sourced from the company's:
Question 797 option, Black-Scholes-Merton option pricing, option delta, no explanation
Which of the following quantities from the Black-Scholes-Merton option pricing formula gives the risk-neutral probability that a European put option will be exercised?
Question 871 duration, Macaulay duration, modified duration, portfolio duration
Which of the following statements about Macaulay duration is NOT correct? The Macaulay duration:
Question 915 price gains and returns over time, IRR, NPV, income and capital returns, effective return
For a share price to double over 7 years, what must its capital return be as an effective annual rate?