FINA 3315 UTA EXAM 1 PRACTICE
QUESTIONS AND ANSWERS 100% PASS
2026/2027
Commonly used multiples for determining and stocks value include
I - Price to earnings
II - Price to sales
III - Price to cash flow
IV - Price to dividends - ANS I, II, and III only
Traditional portfolio managers prefer well known companies because?
I. stocks of well known firms tend to be less risky than stocks of lesser known firms.− −
II. individuals are more apt to purchase a mutual fund if it contains stocks of well known firms.−
III. window dressing encourages the purchase of well known stocks.−
IV. institutional investors tend to exhibit "herd like" behavior. - ANS All of the above (one,
two, three, four)
@2026 ALLRIGHTS RESERVED 1
, Combining uncorrelated assets will - ANS decrease the overall risk level of a portfolio.
To compute the present value of $1000 annuity Received at the end of each of the next three
years and discount at the rate of 5% per year, you should use which of the following excel
commands? - ANS PV: present value
Which one of the following Types of risk cannot be effectively eliminated through portfolio
diversification? - ANS inflation risk
Beginning investors with small amounts to invest should - ANS buy mutual funds or exchange
traded funds (ETFs).
Which of the following is not a wing scheme commonly used in creating equity market indexes?
- ANS Industry weighted
The date on which an investor must be registered shareholder of the firm in order to receive a
dividend is called the? - ANS Date of record
Companies offering their stock to the public for the first time usually seek the assistance of -
ANS investment bankers
It is not unusual for bear markets to occur two or more times in any given ten year period -
ANS True
Which of the following statements about short selling is (are) true?
I. Short selling requires an initial margin deposit.
II. Short sellers begin a transaction with a sale and end it with a purchase.
III. Short sellers profit when the stock prices rises.
@2026 ALLRIGHTS RESERVED 2
QUESTIONS AND ANSWERS 100% PASS
2026/2027
Commonly used multiples for determining and stocks value include
I - Price to earnings
II - Price to sales
III - Price to cash flow
IV - Price to dividends - ANS I, II, and III only
Traditional portfolio managers prefer well known companies because?
I. stocks of well known firms tend to be less risky than stocks of lesser known firms.− −
II. individuals are more apt to purchase a mutual fund if it contains stocks of well known firms.−
III. window dressing encourages the purchase of well known stocks.−
IV. institutional investors tend to exhibit "herd like" behavior. - ANS All of the above (one,
two, three, four)
@2026 ALLRIGHTS RESERVED 1
, Combining uncorrelated assets will - ANS decrease the overall risk level of a portfolio.
To compute the present value of $1000 annuity Received at the end of each of the next three
years and discount at the rate of 5% per year, you should use which of the following excel
commands? - ANS PV: present value
Which one of the following Types of risk cannot be effectively eliminated through portfolio
diversification? - ANS inflation risk
Beginning investors with small amounts to invest should - ANS buy mutual funds or exchange
traded funds (ETFs).
Which of the following is not a wing scheme commonly used in creating equity market indexes?
- ANS Industry weighted
The date on which an investor must be registered shareholder of the firm in order to receive a
dividend is called the? - ANS Date of record
Companies offering their stock to the public for the first time usually seek the assistance of -
ANS investment bankers
It is not unusual for bear markets to occur two or more times in any given ten year period -
ANS True
Which of the following statements about short selling is (are) true?
I. Short selling requires an initial margin deposit.
II. Short sellers begin a transaction with a sale and end it with a purchase.
III. Short sellers profit when the stock prices rises.
@2026 ALLRIGHTS RESERVED 2
