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16. $100 is invested for two years. Which produces the most proceeds? a) 5% simp

ID: 2806801 • Letter: 1

Question

16.       $100 is invested for two years. Which produces the most proceeds?

a)              5% simple interest

b)             4.9% compound interest, annual periodicity

c)              4.9% compound interest, semi-annual periodicity

d)             4.8% compound interest, monthly periodicity

18. Which of the following is(are) correct association(s)? There may be more than one; full credit requires all correct choices. Partial credit will be awarded.

Broker : commission

Dealer: bid-asked spread

Broker: principal

Dealer: agent

22. Underwriting (in the securities markets) refers to:

Investment banks marketing newly issued securities to investors, and purchasing those that are not sold.

Investment banks purchasing securities from investors in the secondary market and selling them to other investors

Investment banks making loans to buyers of newly issued securities

Investment banks finding depositors for commercial banks

99. Knock-Your-Socks-Off shoe store purchased 1,000 pairs of shoes from Classy Shoe Manufacturing Company in 2013 for $100/pair. It sold 800 pairs for $125/pair, with the rest remaining in inventory. How much of these are part of 2013 GDP?

1,000x$100 + 200x$100

800x$125 + 1,000x$100

800x$125 + 200x$100

1,000x$125 + 200x$100

800x$125

Explanation / Answer

16.

An investment produce high proceeds when interest is compounded and if interest is compounded more than once ina year then it would be nettwe, the investor get high proceed in case of compounded interest compounded more than once in a year. So, 4.9% compound interest, semi-annual periodicity produce highest procceds.

Answer (C) is correct answer.

18.

correct association are , Broker : commission, Dealer: bid-asked spread and Dealer: agent.

So, option (A), (B) and (D) is correct answer.

19.

Underwriting is procees in Initial Public offering (IPO) in which Investment banks marketing newly issued securities to investors, and purchasing those that are not sold. Investment also analyse the market situation and decide offering price of new securities.

Option (A) is correct answer.

99.

GDP is defined as final goods and service produce by withing th bountry of country. Here final price of 800 unit is $125 and for the inventory of 200 unit pric would be $100.

So, production as part of 2013 GDP is 800x$125 + 200x$100.

Option (C) is correct answer.

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