investment banker tries to sell securities of an issuing corporation, but assumes no risk if

FIN 100 Quiz 6-Strayer Review Test Submission: Quiz 6 •  Question 1 An order that remains in effect until the end of the day is called a: •  Question 2 The price for which the owner is willing to sell the security is called the: •  Question 3 If an investor feels the price of a stock will decline in the future, which trade should the investor undertake? •  Question 4 An agreement whereby an investment banker tries to sell securities of an issuing corporation, but assumes no risk if the flotation is unsuccessful is called a: •  Question 5 Commercial banks were for many years prohibited from full-fledged investment banking by the: •  Question 6 Sales of securities that the seller does not own is called a: •  Question 7 ___________________ is the maximum purchase price or minimum selling price specified by an investor. •  Question 8 A market whereby large institutional investors arrange purchases and sales of securities among themselves without the benefit of a broker or dealer is referred to as the: •  Question 9 A contract that gives the owner the option or choice of selling a particular good at a specified price on or before a specified date is called a (n): •  Question 10 A contract that obligates the owner to purchase an underlying asset at a specified price on a specified day is a (n) ____________ contract. •  Question 11 Which one of the following is not considered to be a generally recognized type of market efficiency? •  Question 12 Which of the following is not required to compute the standard deviation of a two-stock portfolio? •  Question 13 The market portfolio would have a beta of: •  Question 14 Variations in a firm’s tax rate and tax-related charges over time due to changing tax laws and regulations is called: •  Question 15 In comparing the deviations of returns, which one of the following assets has historically had the largest standard deviation of annual returns? •  Question 16 The risk cause by variations in income before taxes over time because fixed interest expenses do not change when operating income rises or falls is called: •  Question 17 The correlation between the return on the risk-free asset and the return on a risky asset is always: •  Question 18 If the _____________ of a stock is known, an investor can use the security market line to determine the expected return on that stock. •  Question 19 Which one of the following assets has historically had the highest average annual return? •  Question 20 The risk cause by variations in interest expense unrelated to sales or operating income arising from changes in the level of interest rates in the economy is called: