1)
Shares of McDonald Corporation are an example of a (n):
Standardized financial instrument
Non-standardized financial instrument since their prices can differ over time
Standardized financial liability instrument
Open-end investment
2)
Which of the following statement regarding short sales is NOT true?
Short sales are done with the expectation that prices will rise
Short sales can be executed only on an uptrend
Short sales are all done on margin
Short sales may be executed by both individuals and market makers
Explanation by Zubair Hussain;
option #1 wrong ( you short the security in this hope that you will buy them back once prices will fall in future. If you expect the price rise, you must go long instead of short to make profit.)
option 3 correct( All derivatives normally trade on margin)
option 4 correct ( short sell any one can do. Its not restricted to any individual or company)
option 2 correct but few years back it was allowed to short the securities even on downtrend. After two debacles of stock exchanges its now not allowed in Pakistan. even though still people can manage to do that.
3)
Which of the following is defined as an investment company whose capitalization constantly changes as new shares are sold and outstanding shares are redeemed?
Unit investment trust
Closed-end investment company
Exchange traded fund company
Open-end investment company
4)
Which of the following would be considered as the most bullish indicator?
A price decrease with heavy volume
A price increase with small volume
A price increase on heavy trading
No change in price but an increase in volume
5)
Which of the following categories is NOT a financial statement element?
Cash flow
Contributed capital
Assets
Distributions
The information reported in financial statements is organized into ten categories known as elements. : assets, liabilities, equity, contributed capital, revenue, expenses, gains and losses, distributions, and net income.
6)
The use of the earnings multiplier model requires the use of forecast company earnings. How do investors obtain forecasts of company earnings?
Public companies are required to issue forecasts of quarterly earnings, going out three years
Securities analysts develop and publish earnings forecasts, based on their
understanding of the company, its industry, and the overall economy
cc
Because these earnings will be announced in the future, no one can forecast them
Earnings forecasts are based on analysts' expectations of company growth and profitability. To predict earnings, most analysts build financial models that estimate prospective revenuesand costs.
Many analysts will incorporate top-down factors such as economic growth rates, currencies and other macroeconomic factors that influence corporate growth. They use market research reports to get a sense of underlying growth trends. To understand the dynamics of the individual companies they cover, really good analysts will speak to customers, suppliers and competitors. The companies themselves offer earnings guidance that analysts build into the models.On Thu, May 5, 2011 at 10:45 PM, Mr.Usman <usman.vu.143@gmail.com> wrote:
1)
Shares of McDonald Corporation are an example of a (n):
Standardized financial instrument
Non-standardized financial instrument since their prices can differ over time
Standardized financial liability instrument
Open-end investment
2)
Which of the following statement regarding short sales is NOT true?
Short sales are done with the expectation that prices will rise
Short sales can be executed only on an uptrend
Short sales are all done on margin
Short sales may be executed by both individuals and market makers
3)
Which of the following is defined as an investment company whose capitalization constantly changes as new shares are sold and outstanding shares are redeemed?
Unit investment trust
Closed-end investment company
Exchange traded fund company
Open-end investment company
4)
Which of the following would be considered as the most bullish indicator?
A price decrease with heavy volume
A price increase with small volume
A price increase on heavy trading
No change in price but an increase in volume
5)
Which of the following categories is NOT a financial statement element?
Cash flow
Contributed capital
Assets
Distributions
6)
The use of the earnings multiplier model requires the use of forecast company earnings. How do investors obtain forecasts of company earnings?
Public companies are required to issue forecasts of quarterly earnings, going out three years
Securities analysts develop and publish earnings forecasts, based on their
understanding of the company, its industry, and the overall economy
Securities analysts develop and publish earnings forecasts, based on sophisticated statistical techniques
Because these earnings will be announced in the future, no one can forecast them
Best Regards,
Mr Usman Khana Name Of
~*~*~"SiLENT LOVER"~*~*~
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Best Regards,
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