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Mikkelson Corporation's stock had a required return 1. Tom Noel holds the following portfolio: Stock Investment Beta A $150,000 1.40 B 50,000 0.80 C 100,000 1.00 D 75,000 1.20 Total $375,000 Tom plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change? a. -0.190 b. -0.211 c. -0.234 d. -0.260 e. -0.286 2. You hold a diversified $100,000 portfolio ...

Other / Other 16 Apr 2016

Stratified random sampling is a method of selecting a sample 1. The probability distribution of all possible values of the sample proportion is the a. probability density function of b. sampling distribution of c. same as , since it considers all possible values of the sample proportion d. sampling distribution of e. None of the above answers is correct. 2. The point estimator with the smaller variance is said to ...

Other / Other 16 Apr 2016

Which of the following is most likely to occur as you add randomly 1. Which of the following statements best describes what you should expect if you randomly select stocks and add them to your portfolio? a. Adding more such stocks will reduce the portfolio's unsystematic, or diversifiable, risk. b. Adding more such stocks will increase the portfolio's expected rate of return. c. Adding more such stocks will reduce the portfolio's beta ...

Other / Other 16 Apr 2016

Bond A has a 9% annual coupon, while Bond B has a 7% 1. Which of the following statements is CORRECT? a. The higher the maturity risk premium, the higher the probability that the yield curve will be inverted. b. The most likely explanation for an inverted yield curve is that investors expect inflation to increase. c. The most likely explanation for an inverted yield curve is that investors expect inflation to decrease. d. If the yield ...

Other / Other 16 Apr 2016

One obvious advantage of stratified sampling True or false: 1. A point estimate is a single numeric value, a “best guess” of a population parameter, calculated from the sample data. 2. The difference between the point estimate and the true value of the population parameter being estimated is called the estimation error. 3. An interval estimate is an interval calculated from the population data, where we stro ...

Other / Other 16 Apr 2016

We can measure the accuracy of judgmental samples True or false: 1. The primary advantage of cluster sampling is sampling convenience (and possibly less cost). The downside, however, is that the inferences drawn from a cluster sample can be less accurate, for a given sample size, than for other sampling plans. 2. We can measure the accuracy of judgmental samples by applying some simple rules of probability. This way, judgmenta ...

Other / Other 16 Apr 2016

A list of all members of the population 1. The theorem that states that the sampling distribution of the sample mean is approximately normal when the sample size n is reasonably large is known as the: a. central limit theorem c. simple random sample theorem b. central tendency theorem d. point estimate theorem 2. A list of all members of the population is called a: a. sampling unit c. frame b. probability sample d. relevan ...

Other / Other 16 Apr 2016

A statistics professor has just given the final examination NARRBEGIN: SA_86_90 A statistics professor has just given the final examination in his introductory statistics course. In particular, he is interested in learning how his class of 50 students performed on this exam. The data are shown below. 78 72 73 75 79 72 75 77 71 78 83 84 71 81 82 79 71 73 89 74 75 93 74 88 83 90 82 79 62 73 88 76 76 76 80 84 84 91 70 76 74 68 ...

Other / Other 16 Apr 2016

The bond has a yield to maturity 1. A 10-year bond pays an annual coupon, its YTM is 8%, and it currently trades at a premium. Which of the following statements is CORRECT? a. The bond’s current yield is less than 8%. b. If the yield to maturity remains at 8%, then the bond’s price will decline over the next year. c. The bond’s coupon rate is less than 8%. d. If the yield to maturity increases, then the bondâ€â ...

Other / Other 16 Apr 2016

One advantage of a zero coupon Treasury bond 1. Which of the following statements is CORRECT? a. All else equal, high-coupon bonds have less reinvestment rate risk than low-coupon bonds. b. All else equal, long-term bonds have less interest rate price risk than short-term bonds. c. All else equal, low-coupon bonds have less interest rate price risk than high-coupon bonds. d. All else equal, short-term bonds have less reinvestment rate ...

Other / Other 16 Apr 2016