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1. Which statement is false?
- A. If a corporation cannot pay its debts, then the shareholders must pay them.
- B. You buy gas for your car at spot.
- C. A high P/E ratio generally indicates that a stock is riskier than if the P/E ratio were low.
- D. Ask Bid
- E. Stocks in the Dow 30 are all large-cap.
2. Which statement is correct?
- A. Open market operations are the most frequently used tool of monetary policy conducted by the Federal Reserve.
- B. The Federal Reserve Board of Governors has seven Governors plus a Chairman.
- C. The Federal Reserve Open Market Committee sets the discount rate and the Federal Funds rate.
- D. The Federal Reserve District Banks regulate all U.S. banks, and the Federal Reserve Board of Governors supervises all U.S. banks.
3. In order from smallest to largest:
- A. burn, acid, current
- B. burn, current, acid
- C. acid, current, burn
- D. current, acid, burn
- E. current, burn, acid
4.
rf + s[E(rm) - rf] is the...
- A. risk-free rate.
- B. expected market premium.
- C. capital asset pricing model.
- D. none of the above.
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