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Question 1 of 10
1. Question
A hybrid security which serve as a mixture of bonds and exchange-traded funds (ETFs) is also known as:
I. Holding company depository receipts
II. Exchange-traded notes
III. Over-the-counter (OTC) securities
IV. American Depository ReceiptCorrect
Exchange-traded notes (ETNs) are hybrid securities which serve as a mixture of bonds and Exchange-traded funds (ETFs). As their name implies, they are traded on an exchange, although they also have a maturity date like bonds
Incorrect
Exchange-traded notes (ETNs) are hybrid securities which serve as a mixture of bonds and Exchange-traded funds (ETFs). As their name implies, they are traded on an exchange, although they also have a maturity date like bonds
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Question 2 of 10
2. Question
Which of the following term shows the relationship between any two currencies and reflection that how many units of one currency are required to obtain one unit of the other currency:
I. Exchange rate
II. Currency trading
III. Spot markets
IV. Fixed marketsCorrect
An exchange rate is the relationship between any two currencies, and it reflects how many units of one currency are required to obtain one unit of the other currency. They change daily, and many different factors can affect them. This constant change in the exchange rate is known as the float.
Incorrect
An exchange rate is the relationship between any two currencies, and it reflects how many units of one currency are required to obtain one unit of the other currency. They change daily, and many different factors can affect them. This constant change in the exchange rate is known as the float.
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Question 3 of 10
3. Question
Which of the following is the function of Spot Markets?
I. Markets involving agreements for future transactions
II. Controlling the quantity of a foreign currency which is imported or exported
III. The relationship between any two currencies
IV. Aiding a developing countryCorrect
Spot markets are markets where goods are exchanged for cash and immediately delivered. There is no delay to the purchases, and contracts are effective at once.
Incorrect
Spot markets are markets where goods are exchanged for cash and immediately delivered. There is no delay to the purchases, and contracts are effective at once.
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Question 4 of 10
4. Question
When U.S. dollars are deposited anywhere in the world outside the United States, they are called:
I. Eurodollar bond
II. Riyal
III. Eurodollars
IV. RupeesCorrect
When U.S. dollars are deposited anywhere in the world outside the United States, they are called Eurodollars (even if they’re not in Europe).The important thing to remember is that they’re in American dollars, and not the currency of the bank where they’re deposited.
Incorrect
When U.S. dollars are deposited anywhere in the world outside the United States, they are called Eurodollars (even if they’re not in Europe).The important thing to remember is that they’re in American dollars, and not the currency of the bank where they’re deposited.
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Question 5 of 10
5. Question
Business cycle contains how many stages?
I. Four
II. Five
III. Six
IV. SevenCorrect
There are four stages of Business cycle. The first phase of the business cycle is expansion. Second phase of the business cycle, the peak. Third phase of the cycle, called contraction. The last phase of the cycle, the trough.
Incorrect
There are four stages of Business cycle. The first phase of the business cycle is expansion. Second phase of the business cycle, the peak. Third phase of the cycle, called contraction. The last phase of the cycle, the trough.
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Question 6 of 10
6. Question
Which of the following is the third phase of the business cycle?
I. Expansion
II. Peak
III. Trough
IV. ContractionCorrect
The third phase of the cycle, called contraction. After an economy has peaked, economic indicators and trends gradually go on the downswing due to less
investing and spending.Incorrect
The third phase of the cycle, called contraction. After an economy has peaked, economic indicators and trends gradually go on the downswing due to less
investing and spending. -
Question 7 of 10
7. Question
Which of the following statement is true for inverted yield curve?
I. The yield (interest rate) increases as the bond’s maturity increases
II. These can signify a change from recession to economic health
III. Bonds with longer maturities are displayed as having a lower yield rate.
IV. Shares of stock whose value is extremely sensitive to changes in interest ratesCorrect
Inverted yield curve, bonds with longer maturities are displayed as having a lower yield rate. This generally signifies a future recession.
Incorrect
Inverted yield curve, bonds with longer maturities are displayed as having a lower yield rate. This generally signifies a future recession.
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Question 8 of 10
8. Question
A share of stock whose value is extremely sensitive to changes in interest rates is known as:
I. Normal yield stocks
II. Inverted yield stocks
III. Flat yield stocks
IV. Interest-rate-sensitive stocksCorrect
Interest-rate-sensitive stocks are shares of stock whose value is extremely sensitive to changes in interest rates. The price of these stocks will fluctuate widely, for instance, with a modification in the risk-free rate. These stocks will have large beta factors according to the capital asset pricing model.
Incorrect
Interest-rate-sensitive stocks are shares of stock whose value is extremely sensitive to changes in interest rates. The price of these stocks will fluctuate widely, for instance, with a modification in the risk-free rate. These stocks will have large beta factors according to the capital asset pricing model.
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Question 9 of 10
9. Question
Which of the following statement is related to food products and tobacco products:
I. Open Market industries
II. Defensive industries
III. Federal Reserve Board
IV. Cyclical industriesCorrect
Two big defensive industries are food products and tobacco products. Defensive industries are those sectors of the economy that sell products that people tend to buy no matter what the state of the economy is.
Incorrect
Two big defensive industries are food products and tobacco products. Defensive industries are those sectors of the economy that sell products that people tend to buy no matter what the state of the economy is.
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Question 10 of 10
10. Question
Which of the following industries tend to sell expensive durable goods, such as automobiles, or the raw materials used to produce durable goods:
I. Federal Reserve Board
II. Defensive industries
III. Federal Open Market Committee
IV. Open Market industriesCorrect
Cyclical industries tend to sell expensive durable goods, such as automobiles, or the raw materials used to produce durable goods. Cyclical industries are the opposite of defensive industries. The prospects for companies in these industries tend to rise and fall right along with the business cycle
Incorrect
Cyclical industries tend to sell expensive durable goods, such as automobiles, or the raw materials used to produce durable goods. Cyclical industries are the opposite of defensive industries. The prospects for companies in these industries tend to rise and fall right along with the business cycle