An increase in the riskiness of financial securities results in a_______ in the supply of loanable funds and hence shift in the supply curve to the_______ O Decrease, left O Decrease, right O Increase, left O Increase, right
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An increase in the riskiness of financial securities results in a_______ in the supply of loanable funds and hence shift in the supply curve to the_______
O Decrease, left
O Decrease, right
O Increase, left
O Increase, right
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- Unsystematic risk is * a.the risk associated with movements in securities prices B.higher when interest rates rise C.the risk of loss of purchasing power D.reduced through diversificationDuration is important in understanding a fixed income portfolio because A. it is used in the capital asset pricing model B. it measures the interest rate sensitivity of a bonds value C. It measures the correlation with a bank's stock price D. It causes contagionfinancial risk management fill in the blacks with correct answer. Interest rate risk is the potential for investment (....loss/gain..........). that result from a change in the interest rates. If interest rate (rise/fall)..., for instance, the value of the bond or fixed-income instrument will decline.
- If the credit quality of the issuer falls sharply, what is your main concern? a.The share price. b.The volatility of the underlying c.The default risk. d.A rise in risk free interest rates Give typing answer with explanation and conclusion13. Securities with less predictable prices and have longer maturity time is considered as____. A. cash equivalents B. long-term investments C. inventories D. short-term investmentsaccording to capm the expected return on equity includes a reward for: a. market risk and specific risk b. Specific risk only c. Time value of money and market risk d. Diversification and portfolio risk e. Time value of money and specific risk
- Banks use gap analysis to measure interest rate risk in their balance sheets. If firm XYZ is said to have a positive gap, this means: Group of answer choices C. Rate-sensitive assets exceed rate-sensitive liabilities B. Long-term assets are funded with short-term liabilities D. Rate-sensitive assets equal rate-sensitive liabilities A. Liabilities reprice before assetsThe return and volatility of ________ portfolios are often lower than those of other asset types a. Credit Investing b. Market Analysis c. Fixed Income d. Rate and ReturnChanges in interest rates may change the market values of the bank's assets and liabilities by different amounts is a Select one: O a. Spread Risk O b. Refinancing risk O c. Reinvestment risk Od. Price Risk
- A reduction in the willingness of investors to take on risk would have what effect on the Security Market Line? A.no effect B.rotate the SML counter clockwise around the risk-free rate C.rotate the SML clockwise around the risk-free rate D.shift the SML upward, parallel to its previous locationThe additional return over the risk-free rate needed to compensate investors for assuming an average amount of risk. a. Market Risk Premium b. Risk-free rate С. Stock's beta O d. Security Market Line e. Required Return on StockWhich of the following is incorrect regarding margin trading? O a. The relationship between security prices and the new margin is positive. O b. It can be applied to bond trading. O c. An account is restricted when the equity is less than the maintenance margin. O d. The lower the amount of equity, the greater the loss when prices fall.