TB-Ch12-Investment-Practice

ch12Student:___________________________________________________________________________1.Atop-downanalysisofafirm'sprospectsstartswithananalysisofthe____.  A. firm'spositioninitsindustryB. U.S.economyoreventheglobaleconomyC. industryD. specificfirmunderconsideration 2.In1980thedollar-yenexchangeratewasabout$.0045.In2012theyen-dollarexchangeratewasabout80yenperdollar.AJapaneseproducerwouldhavehadtoincreasethedollarpriceofagoodsoldintheUnitedStatesbyapproximately_____tomaintainthesameyenpricein2012.  A. 178%B. 79.5%C. 265.4%D. 36% 3.AnincreaseinthevalueoftheyenagainsttheU.S.dollarcancausetheJapaneseautomakerToyotatoeither_____________onitsU.S.sales.  A. losemarketshareorreduceitsprofitmarginB. gainmarketshareorreduceitsprofitmarginC. losemarketshareorincreaseitsprofitmarginD. gainmarketshareorincreaseitsprofitmargin 4.Youestimatethatthepresentvalueofafirm'scashflowisvaluedat$15million.Thebreakupvalueofthefirmifyouweretosellthemajorassetsanddivisionsseparatelywouldbe$20million.ThisisanexampleofwhatPeterLynchwouldcall___________.  A. astalwartB. slowgrowthC. astarD. anassetplay 5.Between1999and2010,thepurchasingpoweroftheU.S.dollarincreasedrelativetothepurchasingpowerof_______.  A. theUnitedKingdomB. theEuroC. SwitzerlandD. Canada 6.Ifyoubelievetheeconomyisabouttogointoarecession,youmightchangeyourassetallocationbyselling_______andbuying______.  A. growthstocks;long-termbondsB. long-termbonds;growthstocksC. defensivestocks;growthstocksD. defensivestocks;long-termbonds 7.Theyieldcurvespreadbetweenthe10-yearT-bondyieldandthefederalfundsrateisa_______economicindicator.  A. leadingB. laggingC. coincidentD. mixed 8.TheConferenceBoard'sConsumerConfidenceIndexisreleased______.  A. dailyB. weeklyC. monthlyD. quarterly 9.Youcanearnabnormalreturnsonyourinvestmentsviamacroforecasting______.  A. ifyoucanforecasttheeconomyatallB. ifyoucanforecasttheeconomyaswellastheaverageforecasterC. ifyoucanforecasttheeconomybetterthantheaverageforecasterD. onlyifyoucanforecasttheeconomywithperfectaccuracy 10.Whichofthefollowingindustrieswouldmostanalystsclassifyasmature?  A. InternetserviceprovidersB. BiotechnologyC. WirelesscommunicationD. Automanufacturing 11.Whichoneofthefollowingstocksrepresentsindustrieswithbelow-averagesensitivitytothestateoftheeconomy?  A. FinancialsB. TechnologyC. FoodandbeverageD. Cyclicals 12.Themostwidelyusedmonetarypolicytoolis_________.  A. alteringthediscountrateB. alteringreserverequirementsC. openmarketoperationsD. increasingthebudgetdeficit 13.Whichoneofthefollowingistheratioofactualoutputfromfactoriestopotentialoutputfromfactories?  A. CapacityutilizationrateB. ParticipationrateC. DurablegoodsordersrateD. Industrialproductionrate 14.Accordingto__________economists,thegrowthoftheU.S.economyinthe1980scanbeattributedtolowermarginaltaxrates,whichimprovedtheincentivesforpeopletowork.  A. KeynesianB. monetaristC. supply-sideD. demand-side 15.Themarketvalueofallgoodsandservicesproducedduringagiventimeperiodiscalled______.  A. GDPB. industrialproductionC. capacityutilizationD. factoryorders 16.Abigincreaseingovernmentspendingisanexampleofa_________.  A. positivedemandshockB. positivesupplyshockC. negativedemandshockD. negativesupplyshock 17.GDPrefersto_________.  A. theamountofpersonaldisposableincomeintheeconomyB. thedifferencebetweengovernmentspendingandgovernmentrevenuesC. thetotalmanufacturingoutputintheeconomyD. thetotalproductionofgoodsandservicesintheeconomy 18.PortfoliomanagerPeterLynchwouldclassifyCoca-Colaas_________.  A. anassetplayB. aslowgrowerC. astalwartD. aturnaround 19.Attemptingtoforecastfutureearningsanddividendsisconsistentwithwhichofthefollowingapproachestosecuritiesanalysis?  A. TechnicalanalysisB. FundamentalanalysisC. BothtechnicalanalysisandfundamentalanalysisD. Indexing 20.Theanalysisofthedeterminantsoffirmvalueiscalled_____________.  A. fundamentalanalysisB. technicalanalysisC. momentumanalysisD. indexing 21.Whichofthefollowingcompaniesisthebestexampleofaturnaround?  A. Coca-ColaB. MicrosoftC. ExxonMobilD. Kmart 22.Inflationiscausedby________________.  A. unionsB. rapidgrowthofthemoneysupplyC. excesssupplyD. lowratesofcapacityutilization 23.Everythingelseequal,ifyouexpectalargerinterestrateincreasethanothermarketparticipants,youshould_________.  A. buylong-termbondsB. buyshort-termbondsC. buycommonstocksD. buypreferredstocks 24.Toobtainanapproximateestimateoftherealinterestrate,onemust_________the__________thenominalrisk-freerate.  A. add;defaultpremiumtoB. subtract;defaultpremiumfromC. add;expectedinflationtoD. subtract;expectedinflationfrom 25.Whichofthefollowingwouldnotbeconsideredasupplyshock?  A. AchangeinthepriceofimportedoilB. FrostdamagetotheorangecropC. AchangeinthelevelofeducationoftheaverageworkerD. Anincreaseinthelevelofgovernmentspending 26.Ifeconomicconditionsaresuchthatveryslowgrowthisexpectedintheforeseeablefuture,onewouldwanttoinvestinindustrieswith__________sensitivitytoeconomicconditions.  A. below-averageB. averageC. above-averageD. Sincegrowthisexpectedtobeslow,s