Finc600 Week 6 Practice Quiz

FINC600 Week 6 Practice Quiz
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Corporate Finance
Week 6 Practice Quiz


Question 1 of 15 1.0/ 1.0 Points
If the capital markets are efficient, then the sale or purchase of any security at the prevailing market price is:

 
A.Always a positive NPV transaction  
B.Generally a zero NPV transaction  
C.Is always a negative NPV transaction  
D.None of the above
Question 2 of 15 1.0/ 1.0 Points
Generally, a firm is able to find positive NPV opportunities with:
I) Financing decisions
II) Capital investment decisions
III) Short-term borrowing decisions

 
A.I only  
B.I and III only  
C.III only  
D.II only
 
Question 3 of 15 1.0/ 1.0 Points
Stock price cycles or patterns self-destruct as soon as investors recognize them through:

 
A.stock market regulation by the Securities and Exchange Commission (SEC)  
B.price fixing by the specialists on New York Stock Exchange  
C.trading by the investors  
D.none of the above
 
Question 4 of 15 1.0/ 1.0 Points
Which of the following is a statement of semi-strong form efficiency?
I) If the markets are efficient in the semi-strong form then prices will adjust immediately to public information
II) If the markets are efficient in the semi-strong form then prices reflect all information
III) If the markets are efficient in the semi-strong form then prices will adjust to newly published information after a long time delay

 
A.I only  
B.II only  
C.II and III only  
D.III only
Question 5 of 15 1.0/ 1.0 Points
Weak form efficiency implies that past stock price(s)

 
A.patterns tend to repeat itself in the future  
B.are major inputs to the investors for forming trading strategies  
C.do not matter  
D.none of the above
Question 6 of 15 1.0/ 1.0 Points
One important implication of...