Question 31

A sample of 25 junior financial analysts gives a mean salary (in thousands) of 60. Assume the population variance is known to be 100. A 90% confidence interval for the mean starting salary of junior financial analysts is most accurately constructed as:

A)    60 + 1.645(100).

B)   60 + 1.645(2).

C)   60 + 1.645(10).

D)   60 + 1.645(4).

Question 32

A portfolio has a coefficient of variation of 2.0. This means that the portfolio’s:

A)    expected return is 2.0 times its standard deviation of returns.

B)   variance of returns is 0.5 times its expected return.

C)   expected return is 0.5 times its standard deviation of returns.

D)   variance of returns is 2.0 times its expected return.

Question 33

Jay Hamilton, CFA, is analyzing Adams, Inc., a distressed firm. Hamilton believes the firm’s survival over the next year depends on the state of the economy. Hamilton assigns probabilities to four economic growth scenarios and estimates the probability of bankruptcy for Adams under each:

Based on Hamilton’s estimates, the probability that Adams, Inc. does not go bankrupt in the next year is closest to:

A)    18%.

B)   33%.

C)   50%.

D)   67%.

Question 34

The Keynesian view suggests that the government can diminish aggregate demand by using:

A)    restrictive fiscal policy to shift the government budget toward a deficit (or a smaller surplus).

B)   expansionary fiscal policy to shift the government budget toward a deficit (or a smaller surplus).

C)   expansionary fiscal policy to shift the government budget toward a surplus (or a smaller deficit).

D)   restrictive fiscal policy to shift the government budget toward a surplus (or smaller deficit).

Question 35

A loss of economic efficiency from price regulation is least likely to result from a:

A)    minimum wage that is greater than the equilibrium wage for low-skill workers.

B)   rent ceiling that effectively increases renters’ search times for available units.

C)   maximum price for electricity set at a price level at which the quantity of electricity supplied is greater than the quantity demanded.

D)   minimum price for wheat set at a price for which the quantity of wheat demanded is less than the quantity supplied.

[此贴子已经被作者于2008-11-8 18:02:29编辑过]

Question 31

A sample of 25 junior financial analysts gives a mean salary (in thousands) of 60. Assume the population variance is known to be 100. A 90% confidence interval for the mean starting salary of junior financial analysts is most accurately constructed as:

A)    60 + 1.645(100).

B)   60 + 1.645(2).

C)   60 + 1.645(10).

D)   60 + 1.645(4).

The correct answer was B) 60 + 1.645(2).

Because we can compute the population standard deviation, we use the z-statistic. A 90% confidence level is constructed by taking the population mean and adding and subtracting the product of the z-statistic reliability (z_á/2) factor times the known standard deviation of the population divided by the square root of the sample size (note that the population variance is given and its positive square root is the standard deviation of the population): x ± z_á/2 * ( σ / n^1/2) = 60 +/- 1.645 × (100^1/2 / 25^1/2) = 60 +/- 1.645 × (10 / 5) = 60 +/- 1.645 × 2.

This question tested from Session 3, Reading 10, LOS j

Question 32

A portfolio has a coefficient of variation of 2.0. This means that the portfolio’s:

A)    expected return is 2.0 times its standard deviation of returns.

B)   variance of returns is 0.5 times its expected return.

C)   expected return is 0.5 times its standard deviation of returns.

D)   variance of returns is 2.0 times its expected return.

The correct answer was C)

CV = . If CV = 2.0, the standard deviation is 2.0 times the expected return, so the expected return is (1 / 2.0) = 0.5 times the standard deviation.

This question tested from Session 2, Reading 7, LOS h, (Part 2)

Question 33

Jay Hamilton, CFA, is analyzing Adams, Inc., a distressed firm. Hamilton believes the firm’s survival over the next year depends on the state of the economy. Hamilton assigns probabilities to four economic growth scenarios and estimates the probability of bankruptcy for Adams under each:

Based on Hamilton’s estimates, the probability that Adams, Inc. does not go bankrupt in the next year is closest to:

A)    18%.

B)   33%.

C)   50%.

D)   67%.

The correct answer was D) 67%.

Using the total probability rule, the unconditional probability of bankruptcy is (0.2)(0.6) + (0.3)(0.4) + (0.4)(0.2) + (0.1) (0.1) = 0.33. The probability that Adams, Inc. does not go bankrupt is 1 – 0.33 = 0.67 = 67%.

This question tested from Session 2, Reading 8, LOS g

Question 34

The Keynesian view suggests that the government can diminish aggregate demand by using:

A)    restrictive fiscal policy to shift the government budget toward a deficit (or a smaller surplus).

B)   expansionary fiscal policy to shift the government budget toward a deficit (or a smaller surplus).

C)   expansionary fiscal policy to shift the government budget toward a surplus (or a smaller deficit).

D)   restrictive fiscal policy to shift the government budget toward a surplus (or smaller deficit).

The correct answer was D) restrictive fiscal policy to shift the government budget toward a surplus (or smaller deficit).

Policymakers can use the budget to diminish aggregate demand through restrictive fiscal policy. According to the Keynesians, reducing government expenditures and/or increasing tax rates should lead to a decline in the expected size of the budget deficit or an increase in the budget surplus.

This question tested from Session 5, Reading 23, LOS d

Question 35

A loss of economic efficiency from price regulation is least likely to result from a:

A)    minimum wage that is greater than the equilibrium wage for low-skill workers.

B)   rent ceiling that effectively increases renters’ search times for available units.

C)   maximum price for electricity set at a price level at which the quantity of electricity supplied is greater than the quantity demanded.

D)   minimum price for wheat set at a price for which the quantity of wheat demanded is less than the quantity supplied.

The correct answer was C) maximum price for electricity set at a price level at which the quantity of electricity supplied is greater than the quantity demanded.

If the quantity supplied at a given price is greater than the quantity demanded, then that price is greater than the equilibrium price. A price ceiling on electricity set above the equilibrium price will have no effect because the quantity supplied equals the quantity demanded at a price less than this legal maximum. By contrast, a price floor for wheat set above the equilibrium price causes a loss of economic efficiency because producers will supply more than consumers are willing to buy at that price.

A minimum wage causes a loss of efficiency (quantity of labor supplied is greater than the quantity demanded) when it is set above the equilibrium wage for low-skill workers. Increased search time is an example of an inefficiency that results from a rent ceiling below the equilibrium rent level.

This question tested from Session 4, Reading 15, LOS a, (Part 1)

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