mgt411 solved midterm paper fall 2010 december 3

[Xpert]

Question No: 1 ( Marks: 1 ) - Please choose one
[FONT=&quot]Which of the following statement truly represents the main difference between debit card and store value card?[/FONT]
► [FONT=&quot]Debit card is operated by ATM machine while Store value card doesn’t[/FONT]
► [FONT=&quot]Debit card appearance is different from Store value card[/FONT]
► [FONT=&quot]Debit card is not specific for user but store value card is specific[/FONT]
► [FONT=&quot]Debit card is specific for user but store value card is not[/FONT]

Question No: 2 ( Marks: 1 ) - Please choose one
[FONT=&quot]The Consumer Price Index (CPI):[/FONT]
► [FONT=&quot]Tends to overstate inflation due to substitution bias[/FONT]
► [FONT=&quot]Tends to understate actual inflation[/FONT]
► [FONT=&quot]Is more accurate than the GDP deflator[/FONT]
► [FONT=&quot]Is based on basket of goods that changes monthly with consumer expenditures[/FONT]

Question No: 3 ( Marks: 1 ) - Please choose one
[FONT=&quot]Which of the following is[/FONT][FONT=&quot]NOT[/FONT][FONT=&quot] a financial instrument?[/FONT]
► [FONT=&quot]A share of General Motors stock[/FONT]
► [FONT=&quot]A tuition bill[/FONT]
► [FONT=&quot]A U.S. Treasury bond[/FONT]
► [FONT=&quot]A home insurance policy[/FONT]

Question No: 4 ( Marks: 1 ) - Please choose one
[FONT=&quot]A derivative instrument:[/FONT]
► [FONT=&quot]Gets its value and payoff from the performance of the underlying instrument[/FONT]
► [FONT=&quot]Is a high risk financial instrument used by highly risk averse savers[/FONT]
► [FONT=&quot]Comes into existence after the underlying instrument is in default[/FONT]
► [FONT=&quot]Should be purchased prior to purchasing the underlying security[/FONT]

Question No: 5 ( Marks: 1 ) - Please choose one
[FONT=&quot]The financial intermediary that obtains funds largely through premium payments and uses those funds to purchase corporate bonds and mortgages is:[/FONT]
► [FONT=&quot]Credit unions[/FONT]
► [FONT=&quot]Mutual funds[/FONT]
► [FONT=&quot]Life insurance companies[/FONT]
► [FONT=&quot]Pension funds[/FONT]

Question No: 6 ( Marks: 1 ) - Please choose one
[FONT=&quot]Which one of the following financial instrument is [/FONT][FONT=&quot]NOT[/FONT][FONT=&quot] primarily used as store of value?[/FONT]
► [FONT=&quot]Banks loans[/FONT]
► [FONT=&quot]Asset-backed securities[/FONT]
► [FONT=&quot]Insurance contracts[/FONT]
► [FONT=&quot]Stocks[/FONT]

Question No: 7 ( Marks: 1 ) - Please choose one
[FONT=&quot]Which one of the following is [/FONT][FONT=&quot]NOT [/FONT][FONT=&quot]an example of Centralized exchange?[/FONT]
► [FONT=&quot]New York[/FONT][FONT=&quot] Stock Exchange[/FONT]
► [FONT=&quot]NASDAQ[/FONT]
► [FONT=&quot]Large exchanges in London [/FONT]
► [FONT=&quot]Large exchanges in Tokyo[/FONT]

Question No: 8 ( Marks: 1 ) - Please choose one
[FONT=&quot]Which of the following market allowed networks of dealers that are connected electronically?[/FONT]
► [FONT=&quot]New York[/FONT][FONT=&quot] Stock Exchange[/FONT]
► [FONT=&quot]NASDAQ[/FONT]
► [FONT=&quot]Large exchanges in London[/FONT]
► [FONT=&quot]Large exchanges in Tokyo[/FONT]

Question No: 9 ( Marks: 1 ) - Please choose one
[FONT=&quot]Risk sharing is the characteristic of which one of the following?[/FONT]
► [FONT=&quot]Checks[/FONT]
► [FONT=&quot]Checking accounts[/FONT]
► [FONT=&quot]Money[/FONT]
► [FONT=&quot]Bonds[/FONT]

Question No: 10 ( Marks: 1 ) - Please choose one
[FONT=&quot]The future value of $200 at a 5% per year interest rate at the end of one year is:[/FONT]
► [FONT=&quot]$195.00[/FONT]
► [FONT=&quot]$210.00[/FONT]
► [FONT=&quot]$197.50[/FONT]
► [FONT=&quot]$100[/FONT]

Question No: 11 ( Marks: 1 ) - Please choose one
[FONT=&quot]What will be the Future Value (FV) of $1000 in 5 years at 5% interest rate?[/FONT]
► [FONT=&quot]$1300.00[/FONT]
► [FONT=&quot]$1276.28[/FONT]
► [FONT=&quot]$1999.99[/FONT]
► [FONT=&quot]$1500.52[/FONT]