Test Bank for Essentials Of Investments 12th Edition Zvi B
b b b b b b b b b
odie, Alex Kane, Alan J. Marcus
b b b b b
Whichbofbthebfollowingbbeliefsbwouldbnotbprecludebchartingbasbabmethodbofbportfoliobma
nagement?
A.bThebmarketbisbstrong-formbefficient.
B.bThebmarketbisbsemistrong-formbefficient.
C.bThebmarketbisbweak-formbefficient.
D.bStockbpricesbfollowbrecurringbpatterns.b-
bANSWERbbD.bStockbpricesbfollowbrecurringbpatterns.
2.bInbab1953bstudybofbstockbprices,bMauricebKendallbfoundbthatb________.
A.btherebwerebnobpredictablebpatternsbinbstockbprices
B.bstockbpricesbexhibitedbstrongbserialbautocorrelation
C.bday-to-daybstockbpricesbfollowedbconsistentbtrends
D.bfundamentalbanalysisbcouldbbebusedbtobgeneratebabnormalbreturnsb-
bANSWERbbA.btherebwerebnobpredictablebpatternsbinbstockbprices
3.bThebweakbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurrentbsto
ckbprice.
A.ballbpastbinformation,bincludingbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
D.ballbcostlessbinformationb-
bANSWERbbA.ballbpastbinformation,bincludingbsecuritybpricebandbvolumebdata
4.bThebsemistrongbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurr
entbstockbprice.
A.ballbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
,D.ballbcostlessbinformationb-bANSWERbbB.ballbpubliclybavailablebinformation
5.bThebstrongbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurrentbst
ockbprice.
A.ballbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
D.ballbcostlessbinformationb-bANSWERbbC.ballbinformation,bincludingbinsidebinformation
6.bRandombpricebmovementsbindicateb________.
A.birrationalbmarkets
B.bthatbpricesbcannotbequalbfundamentalbvalues
C.bthatbtechnicalbanalysisbtobuncoverbtrendsbcanbbebquitebuseful
D.bthatbmarketsbarebfunctioningbefficientlyb-
bANSWERbbD.bthatbmarketsbarebfunctioningbefficiently
7.bWhenbthebmarketbriskbpremiumbrises,bstockbpricesbwillb________.
A.brise
B.bfall
C.brecover
D.bhavebexcessbvolatilityb-bANSWERbbB.bfall
8.bThebsmall-firmbeffectbisbstrongestbinbwhichbmonth?
A.bJanuary
B.bJune
C.bJuly
D.bDecemberb-bANSWERbbA.bJanuary
9.bEvidencebsuggestsbthatbtherebmaybbeb_______bmomentumbandb________breversalb
patternsbinbstockbpricebbehavior.b
A.bshort-run;bshort-run
B.blong-run;blong-run
,C.blong-run;bshort-run
D.bshort-run;bnegligibleb-bANSWERbbA.bshort-run;bshort-run
10.bProponentsbofbthebEMHbtypicallybadvocateb__________.
A.babconservativebinvestmentbstrategy
B.babliberalbinvestmentbstrategy
C.babpassivebinvestmentbstrategy
D.banbaggressivebinvestmentbstrategyb-bANSWERbbC.babpassivebinvestmentbstrategy
11.bStockbpricesbthatbarebstableboverbtimeb_______.
A.bindicatebthatbpricesbarebusefulbindicatorsbofbtruebeconomicbvalue
B.bindicatebthatbthebmarketbisbnotbincorporatingbnewbinformationbintobcurrentbstockbprice
s
C.bensurebthatbanbeconomyballocatesbitsbresourcesbefficiently
D.bindicatesbthatbreturnsbfollowbabrandom-walkbprocessb-
bANSWERbbB.bindicatebthatbthebmarketbisbnotbincorporatingbnewbinformationbintobcurrent
bstockbprices
12.bThebtendencybwhenbtheb______bperformingbstocksbinbonebperiodbarebthebbestbperfo
rmersbinbthebnextbandbthebcurrentb________bperformersbareblaggingbthebmarketblaterbisb
calledbthebreversalbeffect.
A.bworst;bbest
B.bworst;bworst
C.bbest;bworst
D.bbest;bbestb-bANSWERbbA.bworst;bbest
13.bWhichbofbthebfollowingbisbnotbabmethodbemployedbbybfollowersbofbtechnicalbanalysis
?
A.bcharting
B.brelativebstrengthbanalysis
C.bearningsbforecasting
D.btradingbaroundbsupportbandbresistanceblevelsb-bANSWERbbC.bearningsbforecasting
14.bWhichbofbthebfollowingbisbnotbabmethodbemployedbbybfundamentalbanalysts?
A.banalyzingbthebFed'sbnextbinterestbratebmove
, B.brelativebstrengthbanalysis
C.bearningsbforecasting
D.bestimatingbthebeconomicbgrowthbrateb-bANSWERbbB.brelativebstrengthbanalysis
15.bThebprimarybobjectivebofbfundamentalbanalysisbisbtobidentifyb__________.
A.bwell-runbfirms
B.bpoorlybrunbfirms
C.bmispricedbstocks
D.bhighbP/Ebstocksb-bANSWERbbC.bmispricedbstocks
16.bIfbyoubbelievebinbtheb__________bformbofbthebEMH,byoubbelievebthatbstockbpricesbref
lectballbpubliclybavailablebinformationbbutbnotbinformationbthatbisbavailablebonlybtobinsider
s.
A.bsemistrong
B.bstrong
C.bweak
D.bperfectb-bANSWERbbA.bsemistrong
17.bIfbyoubbelievebinbtheb__________bformbofbthebEMH,byoubbelievebthatbstockbpricesbref
lectballbrelevantbinformation,bincludingbinformationbthatbisbavailablebonlybtobinsiders.
A.bsemistrong
B.bstrong
C.bweak
D.bperfectb-bANSWERbbB.bstrong
18.bMostbofbthebstockbpricebresponsebtobabcorporatebearningsborbdividendbannounceme
ntboccursbwithinb________________.
A.baboutb30bseconds
B.baboutb10bminutes
C.b6bmonths
D.b2byearsb-bANSWERbbB.baboutb10bminutes
19.b__________bisbthebreturnbonbabstockbbeyondbwhatbwouldbbebpredictedbfrombmarketb
movementsbalone.
b b b b b b b b b
odie, Alex Kane, Alan J. Marcus
b b b b b
Whichbofbthebfollowingbbeliefsbwouldbnotbprecludebchartingbasbabmethodbofbportfoliobma
nagement?
A.bThebmarketbisbstrong-formbefficient.
B.bThebmarketbisbsemistrong-formbefficient.
C.bThebmarketbisbweak-formbefficient.
D.bStockbpricesbfollowbrecurringbpatterns.b-
bANSWERbbD.bStockbpricesbfollowbrecurringbpatterns.
2.bInbab1953bstudybofbstockbprices,bMauricebKendallbfoundbthatb________.
A.btherebwerebnobpredictablebpatternsbinbstockbprices
B.bstockbpricesbexhibitedbstrongbserialbautocorrelation
C.bday-to-daybstockbpricesbfollowedbconsistentbtrends
D.bfundamentalbanalysisbcouldbbebusedbtobgeneratebabnormalbreturnsb-
bANSWERbbA.btherebwerebnobpredictablebpatternsbinbstockbprices
3.bThebweakbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurrentbsto
ckbprice.
A.ballbpastbinformation,bincludingbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
D.ballbcostlessbinformationb-
bANSWERbbA.ballbpastbinformation,bincludingbsecuritybpricebandbvolumebdata
4.bThebsemistrongbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurr
entbstockbprice.
A.ballbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
,D.ballbcostlessbinformationb-bANSWERbbB.ballbpubliclybavailablebinformation
5.bThebstrongbformbofbthebEMHbstatesbthatb________bmustbbebreflectedbinbthebcurrentbst
ockbprice.
A.ballbsecuritybpricebandbvolumebdata
B.ballbpubliclybavailablebinformation
C.ballbinformation,bincludingbinsidebinformation
D.ballbcostlessbinformationb-bANSWERbbC.ballbinformation,bincludingbinsidebinformation
6.bRandombpricebmovementsbindicateb________.
A.birrationalbmarkets
B.bthatbpricesbcannotbequalbfundamentalbvalues
C.bthatbtechnicalbanalysisbtobuncoverbtrendsbcanbbebquitebuseful
D.bthatbmarketsbarebfunctioningbefficientlyb-
bANSWERbbD.bthatbmarketsbarebfunctioningbefficiently
7.bWhenbthebmarketbriskbpremiumbrises,bstockbpricesbwillb________.
A.brise
B.bfall
C.brecover
D.bhavebexcessbvolatilityb-bANSWERbbB.bfall
8.bThebsmall-firmbeffectbisbstrongestbinbwhichbmonth?
A.bJanuary
B.bJune
C.bJuly
D.bDecemberb-bANSWERbbA.bJanuary
9.bEvidencebsuggestsbthatbtherebmaybbeb_______bmomentumbandb________breversalb
patternsbinbstockbpricebbehavior.b
A.bshort-run;bshort-run
B.blong-run;blong-run
,C.blong-run;bshort-run
D.bshort-run;bnegligibleb-bANSWERbbA.bshort-run;bshort-run
10.bProponentsbofbthebEMHbtypicallybadvocateb__________.
A.babconservativebinvestmentbstrategy
B.babliberalbinvestmentbstrategy
C.babpassivebinvestmentbstrategy
D.banbaggressivebinvestmentbstrategyb-bANSWERbbC.babpassivebinvestmentbstrategy
11.bStockbpricesbthatbarebstableboverbtimeb_______.
A.bindicatebthatbpricesbarebusefulbindicatorsbofbtruebeconomicbvalue
B.bindicatebthatbthebmarketbisbnotbincorporatingbnewbinformationbintobcurrentbstockbprice
s
C.bensurebthatbanbeconomyballocatesbitsbresourcesbefficiently
D.bindicatesbthatbreturnsbfollowbabrandom-walkbprocessb-
bANSWERbbB.bindicatebthatbthebmarketbisbnotbincorporatingbnewbinformationbintobcurrent
bstockbprices
12.bThebtendencybwhenbtheb______bperformingbstocksbinbonebperiodbarebthebbestbperfo
rmersbinbthebnextbandbthebcurrentb________bperformersbareblaggingbthebmarketblaterbisb
calledbthebreversalbeffect.
A.bworst;bbest
B.bworst;bworst
C.bbest;bworst
D.bbest;bbestb-bANSWERbbA.bworst;bbest
13.bWhichbofbthebfollowingbisbnotbabmethodbemployedbbybfollowersbofbtechnicalbanalysis
?
A.bcharting
B.brelativebstrengthbanalysis
C.bearningsbforecasting
D.btradingbaroundbsupportbandbresistanceblevelsb-bANSWERbbC.bearningsbforecasting
14.bWhichbofbthebfollowingbisbnotbabmethodbemployedbbybfundamentalbanalysts?
A.banalyzingbthebFed'sbnextbinterestbratebmove
, B.brelativebstrengthbanalysis
C.bearningsbforecasting
D.bestimatingbthebeconomicbgrowthbrateb-bANSWERbbB.brelativebstrengthbanalysis
15.bThebprimarybobjectivebofbfundamentalbanalysisbisbtobidentifyb__________.
A.bwell-runbfirms
B.bpoorlybrunbfirms
C.bmispricedbstocks
D.bhighbP/Ebstocksb-bANSWERbbC.bmispricedbstocks
16.bIfbyoubbelievebinbtheb__________bformbofbthebEMH,byoubbelievebthatbstockbpricesbref
lectballbpubliclybavailablebinformationbbutbnotbinformationbthatbisbavailablebonlybtobinsider
s.
A.bsemistrong
B.bstrong
C.bweak
D.bperfectb-bANSWERbbA.bsemistrong
17.bIfbyoubbelievebinbtheb__________bformbofbthebEMH,byoubbelievebthatbstockbpricesbref
lectballbrelevantbinformation,bincludingbinformationbthatbisbavailablebonlybtobinsiders.
A.bsemistrong
B.bstrong
C.bweak
D.bperfectb-bANSWERbbB.bstrong
18.bMostbofbthebstockbpricebresponsebtobabcorporatebearningsborbdividendbannounceme
ntboccursbwithinb________________.
A.baboutb30bseconds
B.baboutb10bminutes
C.b6bmonths
D.b2byearsb-bANSWERbbB.baboutb10bminutes
19.b__________bisbthebreturnbonbabstockbbeyondbwhatbwouldbbebpredictedbfrombmarketb
movementsbalone.
