I have questions if sombody can help that might help you too....
here is couple question here first to see how we can do?

1. Risk can be viewed as(In the terms of finance..)
a. the degree of variability of return
b. the standard deviation of the probability distribution of return
c. the chance that return will be less than expected
d. a value neutral concept
e. all of the above

2. The security market line( in finance term)
a. relates an individual security's return to the returns of other securities in the same industry.
b. provides a picture of the risk-return tradeoff required by diversified investors
c. has as its slope the beta of the security
d. none of the above

3. A stock has an expected return of 10% and a variance of 25%. Its coefficient of variation is:
a. 2.5
b. .4
c. .5
d. 2.0

4. The only component of the CAPM equation that relates specifically to a company is:
a. bX
b. kM
c. kRF
d. (kM - kRF)

find the correct answer, i will find it as well

what happen to everybody, nobody wants to try....

This is a slight out of context query but I will be grateful if someone can explain me what exactly is the difference between Pre MBA, MBA and executive MBA (e-MBA, I guess). Also please mention how are they correlated in terms of number of years of the course and the courseworks.

Thanks in advance...

I hope Storm93 wouldn't mind me intruding in his/her thread. :)

3. c

i think
1. Risk can be viewed = All of the Above
2. SML = B provides risk/return trade off required by a diversified investor
3. CV = S/X so...5/10 = .5
4. Component specific to firm in CAPM = A. Beta

Thanks wit's end.
I had same answer except the answer for the 4th was (kM - kRF) i was little bit of confuse.

here is few other please find the answer .

1. Effective annual rates decrease as __________ decrease:
a. annual percentage rates
b. number of compounding periods
c. quoted rates
d. All of the above

2. If the present value of a given sum is equal to its future value, then
a. the discount rate must be very high
b. there is no inflation
c. the discount rate must be zero
d. none of the above are correct

3. More frequent compounding results in _________ future values and _________ present values than less frequent compounding at the same nominal interest rate.
a. higher, higher
b. lower, higher
c. higher, lower
d. lower, lower

4. Your bank balance is exactly $10,000. Three years ago you deposited $7,938 and have not touched the account since. What annually compounded rate of interest has the bank been paying?
a. 8.65%
b. 26.00%
c. 8.00%
d. 6.87%

5. If you invest the $10,000 you receive at graduation (age 22) in a mutual fund which averages a 12% annual return, how much will you have at retirement in 40 years?
a. $909,090
b. $930,510
c. $783,879
d. $510,285

6. An annuity with $1,000 annual payments at the end of each year, with a 10% interest rate, is worth how much at the end of four years?
a. $4,641.00
b. $3,169.87
c. $5,105.10
d. none of the above

7. Seabee makes quarterly (end of period) payments of $30,000 into a pension fund earning 12 percent compounded quarterly for 10 years. How much interest will have been earned in 10 years?
a. $2,262,030
b. $2,105,880
c. $905,880
d. $1,062,030

8. Idlewild Bank has granted you a seven year loan for $50,000. If your seven annual end of the year payments are $11,660.45, what is the rate of interest Idlewild is charging?
a. 14%
b. 23%
c. 12.6%
d. none of the above

9. A four-year annuity of $1,000 annual payments at the end of each year, with a 10% interest rate is worth how much today?
a. $2,914.67
b. $3,486.85
c. $3,169.87
d. none of the above

10. A contract guarantees payment of $500 a month for the next 18 months starting today. How much is that contract worth today if the interest rate is 12% compounded monthly?
a. $8281.14
b. $8199.15
c. $9905.58
d. $9087.50

11. Assume you want to pay off your $10,000, 30-month car loan after only the first 12 months of payments. With interest at 12% compounded monthly, how much will you need pay off the loan in full at the end of the first year?
a. $5,639
b. $6,354
c. $4,361
d. $7425

Mr hunk, This is neither of those.... this is just for practice who ever would like to bring the great question and answer. Great question, correct answer and that will make you expert.
I am not expert but i am trying to understand better.

I tried five questions, may or maynot be correct.
1. D
2.C discounted rate must be 0
3. C higher, lower
4. C
5. B

Here is the answer I have got....

1.D, 2.C, 3.B, 4.C, 5.B, 6.A, 7.A, 8.A, 9.C, 10.B, 11.A

Try this one...( This is also from finance)

1. Capital budgeting involves how companies spend
a. Day to day resources.
b. Money raised in capital markets.
c. Expenses only.
d. Large sums on infrequent projects.

2. If a project's NPV is negative
a. the project earns less than the cost of capital
b. the investment will not add value or contribute to shareholder wealth
c. the present value of expected cash outflows is greater than the present value of expected cash inflows

d. all of the above
3. The internal rate of return is the rate of interest that makes the present value of a projects cash inflows:
a. greater than the present value of its cash outflows
b. less than the present value of its cash outflows
c. equal to the present value of its cash outflows
d. none of the above

4. The internal rate of return (IRR) is simply the return on a project viewed as an investment. Therefore any project whose IRR exceeds the cost of capital
a. should be undertaken if the company has the resources to do it
b. contributes to wealth because it earns more than the cost of the money used to do it
c. should not be undertaken because IRR isn't as good as NPV
d. a and b

5. Payback does not include the following in its analysis
a. the time value of money.
b. all of the project's cash flows.
c. a measure of the change in shareholders wealth.
d. all of the above.

6. The NPV and IRR techniques can give conflicting results
a. in standalone cases where the project's NPV profile is downward sloping.
b. in mutually exclusive decisions in which the NPV profiles do not cross.
c. in mutually exclusive situations in which the NPV profiles cross anywhere.
d. in mutually exclusive decisions in which the NPV profiles cross in the first quadrant.

if some one got the answer please let me know....

Here is what i got...storm
1. capital budgeting = D
2. Negative NPV = D
3. IRR = C
4. Undertake IRR = D
5. Payback = D
6. Conflict NPV Vs IRR = D

sir haru ko tuntion institue chain kanha hola....

zhyapee, how are you doing friend ? i am just trying to practice . And i come to understand it is helpful to understand....u can also bring the question...that help to everybody and who knows better that will help to others....

now i have few other question here we will compare the answer later:

1. The net present value (NPV) method assumes that cash flows are reinvested at the:
a. IRR
b. Cost of Capital
c. Average rate it pays investors
d. Both b & c

2. A larger interest rate will reduce all of the following, except the:
a. initial cash flow.
b. net present value.
c. present value of future cash outlays.
d. profitability ind.ex.

3.According to one study done some time ago, more than 80% of small firms use the __________ method to evaluate capital projects.
a. NPV
b. IRR
c. payback
d. PI

here we go
1. NPV assumes that cashflow are reinvested at the Cost of Capital which is the Average rate it pays investors. So answer is D.
2. A larger interest rate will reduce will not reduce initial Cashflow. So answer is A.
3. According to one study done some time ago, more than 80% of small firms use the PAYBACK method to evaluate capital projects. So Answe is C.

Storm I think you were right on the component of CAPM that specifically relates to the company is (kM - kRF) . Km is the market risk premium of the particular Asset class, where as Beta is the I believe measure of by how much the Asset Class is riskier than the Industry.

Thanks, that helped me lot For the question 1 i was just thinking about Average rate it pays investors. good...

here couple others... if any body get chance...

1. which of the following is most correct?
a. stand-alone projects with positive npv's should always be accepted.
b. mutually exclusive projects with NPV's should always be accepted.
c. Projects can be mutually exclusive even if they address totally different business issue.
d. Both a and c are correct.
e. ALL

2. A firm's cost of capital is:
a. the cost of rising money to do a particular project
b. the average return it pays it investors for the use of their money
c. a cost a firm has to pay their shareholders.
d. none

3. All other things being equal, what is the major impact that an increase in the expected inflation rate would be expected to have on the security market line?
a. reduce its slope
b. shift it down
c. shift it up
d.reduce required returns for investors in any individual asset

here it is..
1. stand alone project with +ve NPV should be accepted and Projects can be mutually exclusive even if they address totally different business issue. So, the answer is C.
2.A firm's cost of capital is: the average return it pays it investors for the use of their money. So B
3.All other things being equal, what is the major impact that an increase in the expected inflation rate would be expected to have on the security market line will SHIFT UP.
so C.

1. = D ...C was a typho
G'night

Sombody help me on thisl please,

1. Bonds are referred to as non-amortizable debt, which means:
a. interest is paid regularly during the term, usually semiannually whereas repayments of principal are annual
b. interest is paid regularly during the term, usually semiannually, and repayments of principal are semiannual
c. interest is paid regularly during the term, usually semiannually, whereas repayment of principal does not occur until the maturity date
d. interest and principal are paid regularly during the term, usually annually

2. Which of the following risks do debt ratings specifically measure?
a. Interest Rate Risk
b. Maturity Risk
c. Default Risk
d. Both b & c
e. All of the above

3. A call provision:
a. Is exercised when interest rates are falling
b. Increases risk to the bondholder
c. Can be exercised any time after a bond is issued
d. Both a & b
e. All of the above

4. Although the maturity value of a bond is fixed, changes in current interest rates will:
a. influence the amount of the semiannual coupon payment
b. affect the bond's yield
c. inversely affect the market price of the bond
d. b and c

5. If current interest rates are higher than a bond's coupon rate, owners can:

a. hold the bond until maturity, at which point its market value will equal its face value
b. sell the bond at a premium, because investors are sensitive to price changes in bonds caused by increased interest rates
c. sell the bond at a discount, because investors recognize that the lower the bond's price the higher is its yield
d. a and c

6. Which of the following events tend to make it less likely that a company will call a bond?

a. A reduction in forecast inflation rates.
b. The company's bonds are downgraded by Moody's rating service.
c. A significant lawsuit is filed against the company.
d. Answers a. and b. are correct.
e. Answers b. and c. are correct.