1) The expected rate of return of an investment is 28.36, while its measurement

Question

1) The expected rate of return of an investment is 28.36, while its measurement of risk is 4.216. The risk per unit of return on this investment would be

a) 119.57 b) 6.7268 c) 0.1487 d) 35.576

2) Which of the followings would impact the rating of a bond?

a) Maturity b) Overseas operation of the issuing company c) Financial ratios d) All of the above

3) The current exchange rate between French franc and U.S. Dollar is FF 5.529 per dollar. Last month this rate was FF 5.491 per dollar.

a) FF has appreciated b) US $ has depreciated c) FF has depreciated d) US $ has appreciated

Explanation / Answer

1) The expected rate of return of an investment is 28.36, while its measurement of risk is 4.216. The risk per unit of return on this investment would be

Risk per unit of return = 4.216/28.36

Risk per unit of return = 0.1487

Answer

c) 0.1487

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