This quiz works best with JavaScript enabled. Home > Finance > Risk > Risk And Return – Quiz 7 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Risk And Return Quiz 7 (12 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Have a wide variety of investments in a portfolio A) Portfolio Maximization. B) Investment Diversification. C) Portfolio Diversification. D) Portfolio Diversifcation. Show Answer Correct Answer: C) Portfolio Diversification. 2. You bought 100 shares of stock at $ 15 per share. You sold your 100 shares at $ 21.75 per share. Calculate your percentage of gain. A) 45%. B) 21%. C) 38%. D) 16%. Show Answer Correct Answer: A) 45%. 3. If Soraya holds a single asset in his investment portfolio, his risk exposure would be best measured by the ..... A) Coefficient of variation. B) Normal distribution of returns. C) Standard deviation of returns. D) None of the above. Show Answer Correct Answer: C) Standard deviation of returns. 4. Savings Instruments A) Vehicles for money that has been set aside for the future. B) Transportation. C) Vehicles for money. D) High Interest, Low Risk. Show Answer Correct Answer: A) Vehicles for money that has been set aside for the future. 5. Unilever shares have a beta of 0.3. Is Unilever stock risky? A) No, when compared to the stock average. B) Very risky, because of the low beta value. C) No, when compared to riskless assets. D) None of above. Show Answer Correct Answer: A) No, when compared to the stock average. 6. It is known: the historical return of security A is 5%; 8.5% and 10%historical return from the market is 2%; 3% and 4%Beta of security A is ..... and security A ..... A) 1, 7; not risky. B) 2; risky. C) 0.5; risky. D) 2, 5; risky. Show Answer Correct Answer: D) 2, 5; risky. 7. General investment goals of a investor A) Investment Policy Statement. B) Investment Board. C) Investment Statement. D) Investment Policy Paper. Show Answer Correct Answer: A) Investment Policy Statement. 8. How many diverse securities are required to eliminate the majority of the diversifiable risk from a portfolio? A) 10. B) 5. C) 100. D) 40. Show Answer Correct Answer: A) 10. 9. The portfolio which consist of perfectly positive correlated assets have no effect of A) Negativity. B) Positivity. C) Correlation. D) Diversification. Show Answer Correct Answer: D) Diversification. 10. What information do you need to compute the volatility of a portfolio? A) Portfolio weights, portfolio return. B) Portfolio weights, volatility of the securities, correlation coefficient of securities return. C) Value of investment, total value of portfolio. D) None of above. Show Answer Correct Answer: B) Portfolio weights, volatility of the securities, correlation coefficient of securities return. 11. Which type of risk does diversification help to manage? A) Specific. B) Market. C) Both a and b. D) Neither a nor b. Show Answer Correct Answer: A) Specific. 12. The following measurements are used to describe the risk in a portfolio: A) Standard deviation. B) Beta. C) Probability distribution. D) Correlation. Show Answer Correct Answer: B) Beta. ← PreviousRelated QuizzesFinance QuizzesRisk And Return Quiz 1Risk And Return Quiz 2Risk And Return Quiz 3Risk And Return Quiz 4Risk And Return Quiz 5Risk And Return Quiz 6 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books