THROUGH 30 RELATE TO QUANTITATIVE METHODS. (18 MINUTES)AN...

Questions 19 through 30 relate to Quantitative Methods. (18 minutes)

An investor wants to receive $10,000 annually for ten years with the first payment five years from today. If the investor can

earn a 14% annual return, the amount that she will have to invest today is closest to:

$27,091.

A)

B)

$30,884.

C)

$52,161.

Question #20 of 120

Question ID: 1146276

Which of the following statements about the frequency distribution shown below is least accurate?

Return Interval Frequency0% to 5% 10> 5% to 10% 20> 10% to 15% 30> 15% to 20% 20

The return intervals are mutually exclusive.

The cumulative absolute frequency of the fourth interval is

20.

The relative frequency of the second return interval is

25%.

Question #21 of 120

Question ID: 1146281

An analyst obtains the following annual returns for a group of stocks: 10%, 8%, 7%, 9%, 10%, 12%, 11%, 10%, 30%, and

13%. This distribution:

has a median greater than its mode.

is skewed to the right, and the mean is less than the

median.

is skewed to the right, and the mean is greater than the

mode.

Question #22 of 120

Question ID: 1146282

An analyst gathers the following data about the mean monthly returns of three securities:

Security Mean Monthly Return Standard DeviationX 0.9 0.7Y 1.2 4.7Z 1.5 5.2

Which security has the highest level of relative risk as measured by the coefficient of variation?

X.

Y.

Z.

Question #23 of 120

Question ID: 1146278

The median of a distribution is least likely equal to:

the second quartile.

the third quintile.

the fifth decile.

Question #24 of 120

Question ID: 1146283

Which of the following statements about probability concepts is most accurate?

Subjective probability is a probability that is based on

personal judgment.

A conditional probability is the probability that two or more

events happen concurrently.

An empirical probability is one based on logical analysis

rather than on observation or personal judgment.

Question #25 of 120

Question ID: 1146294

Which of the following is least likely an underlying assumption of technical analysis?

Supply and demand are governed solely by rational

behavior.

Actual shifts in supply and demand can be observed in

market price behavior.

Prices for individual securities and the market tend to

move in trends that persist for long periods of time.

Question #26 of 120

Question ID: 1146284

Alex White, CFA, is examining a portfolio that contains 100 stocks that are either value or growth stocks. Of these 100 stocks,

40% are value stocks. The previous portfolio manager had selected 70% of the value stocks and 80% of the growth stocks.

What is the probability of selecting a stock at random that is either a value stock or was selected by the previous portfolio

manager?

28%.

76%.

88%.

Question #27 of 120

Question ID: 1146288

Which of the following statements about the normal distribution is least accurate? The normal distribution:

has a mean of zero and a standard deviation of one.

is completely described by its mean and standard

deviation.

is bell-shaped, with tails extending without limit to the left

and to the right.

Question #28 of 120

Question ID: 1146289

A manager forecasts a bond portfolio return of 10% and estimates a standard deviation of annual returns of 4%. Assuming a

normal returns distribution and that the manager is correct, there is:

a 90% probability that the portfolio return will be between

3.2% and 17.2%.

a 95% probability that the portfolio return will be between

2.16% and 17.84%.

a 32% probability that the portfolio return will be between

6% and 14%.

Question #29 of 120

Question ID: 1146290

An investment has an expected return of 10% with a standard deviation of 5%. If the returns are normally distributed, the

chance of losing money is closest to:

2.5%.

5.0%.

16.0%.

Question #30 of 120

Question ID: 1146292

Which of the following statements about sampling and estimation is least accurate?

Sampling error is the difference between the observed

value of a statistic and the value it is intended to estimate.

A simple random sample is a sample obtained in such a

way that each element of the population has an equal

probability of being selected.

The central limit theorem states that the sample mean for

a large sample size will have a distribution that is the

same as the distribution of the underlying population.

Question #31 of 120

Question ID: 1146311