兹维博迪金融学第二版试题库.docx

1、兹维博迪金融学第二版试题库兹维博迪金融学第二版试题库10TB(1)(总15页) Chapter TenPrinciples of Risk ManagementThis chapter contains 30 multiple choice questions, 10 short problems, and 5 longer problems.Multiple Choice1._ that “matters” because if affects peoples welfare. _ exists whenever one does not know for sure what will oc

2、cur in the future.(a)Uncertainty is risk; Uncertainty(b)Risk is uncertainty; Uncertainty(c)Risk is uncertainty; Risk(d)Uncertainty is risk; Risk Answer: (b)2._ is a measure of willingness to pay to reduce ones exposure to risk. (a)Risk aversion(b)Risk avariciousness(c)Risk predilection(d)Risk inflat

3、ion Answer: (a)3.When choosing among investment alternatives with the same expected rate of return, a risk averse individual chooses the one with the _ risk.(a)surest(b)most uncertain(c)lowest (d)highest Answer: (c)4._ is a particular type of risk people face because of the nature of their business

4、or pattern of consumption.(a)Operational efficiency exposure(b)Opportunity exposure(c)Risk exposure(d)Risk reduction Answer: (c)5._ are investors who take positions that increase their exposure to certain risks in the hope of increasing their wealth.(a)Operations insurers(b)Foreign exporters(c)Hedge

5、rs(d)Speculators Answer: (d)6.The riskiness of an asset or a transaction _ be assessed in isolation or in the abstract.(a)can (b)cannot(c)must(d)it varies according to the situation Answer: (b)7.By definition, _ are investors who take positions to reduce their exposures.(a)operations insurers(b)fore

6、ign exporters(c)hedgers(d)speculators Answer: (c)8.The risk of loss arising from obsolescence due to technological change or changes in consumer taste is an example of _.(a)unemployment risk(b)liability risk(c)financial-asset risk(d)d consumer-durable asset risk Answer: (d)9.The risk arising from ho

7、lding different kinds of financial assets such as equities or fixed income securities denominated in one or more currencies is an example of _.(a)unemployment risk(b)liability risk(c)financial-asset risk(d)consumer-durable asset risk Answer: (c)10.Business risks of the firm are borne by its _.(a)sha

8、reholders(b)creditors(c)employees(d)all of the above Answer: (d)11._ consists of figuring out what the most important risk exposures are for the unit of analysis. (a)Risk assessment(b)Selection of risk management techniques(c)Implementation(d)Risk identification Answer: (d)12.Which of the following

9、is most likely to need a lot of life insurance?(a)a single person with no dependents(b)a divorced person with no dependents(c)a double-income couple with no kids(d)married person with children Answer: (d)13._ is the quantification of the costs associated with the risks that have been identified in t

10、he first step of risk management.(a)Risk assessment(b)Selection of risk management techniques(c)Implementation(d)Review Answer: (a)14.Selling a risky asset to someone else and buying insurance are examples of _.(a)risk avoidance(b)loss prevention and control(c)risk transfer(d)risk retention Answer:

11、(c)15.One is said to _ a risk when the action taken to reduce ones exposure to a loss also causes one to give up the possibility of a gain.(a)insure(b)diversify(c)hedge(d)pay a premium with Answer: (c)16.When you _ you pay a premium to eliminate the risk of loss and retain the potential for gain.(a)

12、insure(b)diversify(c)hedge(d)speculate Answer: (a)17.In order for diversification to reduce your risk exposure, the risks must be _(a)less than perfectly correlated with each other(b)more than perfectly correlated with each other(c)uncorrelated(d)none of the above Answer: (a)18.The demand for ways t

13、o manage risk has been increased by _.(a)increased volatility of exchange rates(b)increased volatility of interest rates(c)increased volatility of commodity prices(d)all of the above Answer: (d)19.Moral hazard and adverse selection are examples of _.(a)transactions costs(b)incentive problems(c)trans

14、ference costs(d)both a and b Answer: (b)20._ is defined as quantitative analysis for optimal risk management.(a)Portfolio theory(b)Corporate theory(c)Diversification theory(d)Probability theory Answer: (a)21.An asset portfolios expected return is identified with the _ of the distribution, and its ri

15、sk with the _.(a)variance; average(b)mean; standard deviation(c)standard deviation; average(d)median; normal distribution Answer: (b)22.Suppose you buy shares of RayFran stock at a price of $110 per share and intend to hold them for a year. Suppose RayFran pays a dividend of $ per share over that ye

16、ar. Compute the total rate of return on a share of RayFran stock if at the end of the year you sell it for $ per share.(a)%(b)%(c)%(d)% Answer: (d)23.The _ a stocks volatility, the _ the range of possible outcomes and the _ the probabilities of those returns at the extremes of the range.(a)larger; n

17、arrower; larger(b)larger; narrower; smaller(c)larger; wider; larger(d)larger; wider; smaller Answer: (c)24.Consider the probability distribution of rate of return on RayFran stock: Rate of Return Probability 40% 15% 8% Compute the expected rate of return on RayFran stock.(a)%(b)%(c)%(d)% Answer: (c)

18、25.Refer to question 24. Now compute the standard deviation of RayFran stock.(a)%(b)%(c)%(d)% Answer: (c)26.Consider a stock with an expected return of 15% and a standard deviation of 8% that is normally distributed. What is the confidence interval for this stocks rate of return?27.(a)(7%, 23%)(b)(9

19、%, 39%)(c)(1%, 39%)(d)(1%, 31%) Answer: (d)For questions 27 through 30, use the following table:Historical ReturnsYearToysRMe Rouge1234515%20%-5%12%10%13%17%-7%8%6%28.What are the mean returns for ToysRMe and Rouge, respectively?29.(a)Toys R Me: %; Rouge: %(b)Toys R Me: %; Rouge: %(c)Toys R Me: %; R

20、ouge: %(d)Toys R Me: %; Rouge: % Answer: (b)30.What is the standard deviation of returns for Toys R Me For Rouge(a)Toys R Me: %; Rouge: %(b)Toys R Me: %; Rouge: %(c)Toys R Me: %; Rouge: %(d)Toys R Me: %; Rouge: % Answer: (b)31.Suppose the returns for Toys R Me and Rouge are normally distributed. Det

21、ermine the confidence interval for Toys R. Me.(a)%, %)(b)(%, %)(c)(%, %)(d)%; %) Answer: (d)32.Determine the confidence interval for Rouge.(a)%, %)(b)(, %)(c), %)(d)(, %) Answer: (c)Short Problems1.Briefly distinguish between the three methods available to transfer risk: hedging, insuring and divers

22、ifying. Answer: Hedging: One is said to hedge a risk when the action taken to reduce ones exposure to a loss also causes one to give up the possibility of a gain. Insuring: Insuring means paying a premium to eliminate the risk of loss and retain the potential for gain. Diversifying: Diversifying mea

23、ns holding similar amounts of many risky assets instead of concentrating all of your investment in only one. Diversification thereby limits your exposure to the risk of any single asset.2.Outline the steps in the risk-management process. Answer: The risk management process can be broken down into fi

24、ve steps: 1. Risk identification 2. Risk assessment 3. Selection of risk management techniques 4. Implementation 5. Review3.Think of a bookstore. What risks is such a business exposed to, and who bears them?4.5. Answer: Major risks: Risk that inventory will not arrive on time Risk that employees wil

25、l be late or absent Risk that computers/registers will break down Risk of new competition in the area (especially - the “superstores”) Risk that distributors prices will increase dramatically These risks are borne by shareholders, owners, employees, creditors, customers, suppliers.6.Explain why the

26、sale/purchase of a house is similar to a forward contract in nature. Answer: Both parties eliminate the uncertainty associated with price volatility in the housing market during the months of settling the contract between them. Even though the transfer of ownership for the house wont happen for many

27、 months, the buyer and seller of a house can contractually settle on a transaction price for the house.7.Explain the difference between insuring and hedging. Answer: When you hedge, you eliminate the risk of loss by giving up the potential for gain. However, when you insure, you pay a premium to eli

28、minate the risk of loss and retain the potential for gain.8.Discuss the two factors limiting the efficient allocation of risks. Answer: Transactions costs and incentive problems are the two key factors limiting the efficient allocation of risks. Transactions costs include the costs of establishing a

29、nd running institutions such as insurance companies or securities exchanges and the costs of writing and enforcing contracts. Moral hazard and adverse selection are examples of incentive problems, which stand in the way of the development of institutions for efficient risk sharing. Moral hazard exis

30、ts when having insurance against some risk causes the insured party to take greater risk or to take less care in preventing the event that gives rise to the loss. The problem with adverse selection relates to the fact that those who purchase insurance against risk are more likely than the general population to be at risk.9.In the case of insuring a ship, explain how the moral hazard problem can lead