Financial Management - Study Mode

[#406] An amount invested is Rs 1500 and an amount received is Rs 2000 then return would be
Correct Answer

(A) Rs 500.00

Explanation

Solution: Return = Amount Recieved - Amount Invested = Rs. 2000 - Rs. 1500 = Rs. 500.

[#407] External factors such as expiration of basic patents and industry competition effect
Correct Answer

(C) company's beta

Explanation

Solution: External factors such as expiration of basic patents and industry competition effect company's beta. A company's beta is a measure of the volatility, or systematic risk, of a security compared to the broader market.

[#408] Type of risk in which beta is equal to one is classified as
Correct Answer

(D) average risk stock

Explanation

Solution: Type of risk in which beta is equal to one is classified as average risk stock. An average-risk stock is defined as one that tends to move up and down in step with the general market.

[#409] A portfolio consists of all stocks in a market is classified as
Correct Answer

(A) market portfolio

Explanation

Solution: A portfolio consists of all stocks in a market is classified as market portfolio. A market portfolio is a theoretical bundle of investments that includes every type of asset available in the world financial market, with each asset weighted in proportion to its total presence in the market.

[#410] Beta coefficient is used to measure market risk which is an index of
Correct Answer

(C) stock market volatility

Explanation

Solution: Beta coefficient is used to measure market risk which is an index of stock market volatility. In the securities markets, volatility is often associated with big swings in either direction. For example, when the stock market rises and falls more than one percent over a sustained period of time, it is called a "volatile" market.