Which of the following is/are an example(s) of a risk-free asset?

• A) Treasury notes
• B) Government bonds
• C) All of the given options
• D) T-bills

A beta less than 1 indicates that______________.

• A) The stock is less volatile than the market
• B) The stock is as volatile as the market is
• C) The stock has no risk
• D) The stock is more volatile than the market

In risk matrix, which of the following is the area where no further measures for risk reduction is necessary?

• A) Red
• B) Green
• C) Yellow
• D) Black

Which of the following statements regarding the Capital Allocation Line (CAL) is FALSE?

• A) It shows the efficient frontier of risky assets in the absence of a risk-free asset
• B) The CAL shows risk-return combinations
• C) The slope of the CAL is also called the reward-to-variability ratio
• D) It helps achieve maximum returns at minimal risk

The risk-free security has a beta equal to ________.

• A) One
• B) Less than one
• C) More than one
• D) Zero

Which of the following variables is/are used in VaR statistic calculations?

• A) Time period
• B) Confidence level
• C) All of the given options are correct
• D) Loss amount

One of the main drivers of portfolio return is:

• A) Currency movement
• B) All of the given options are correct
• C) Systematic risk
• D) Asset allocation

Which of the following methods of VaR is the most easiest?

• A) Monte Carlo Simulation
• B) Variance-covariance method
• C) None of the given options is correct
• D) Historical Method

While the efficient frontier of portfolios is graphically presented, __________ is plotted on x-axis or horizontal axis.

• A) Covariance
• B) Expected return
• C) Sharpe ratio
• D) Standard deviation

____________ of portfolio return measures the variability of the expected rate of return of a portfolio.

• A) All of the given options
• B) Covariance
• C) Standard deviation
• D) Correlation coefficient

Which of the following strategy works by buying a currency at the bid price and selling at the ask price to receive the difference between the two price points?

• A) Swing trading
• B) Scalping
• C) Day trading
• D) Position trading

Which of the following is/are the advantage(s) of VaR?

• A) Investors can measure and compare the VaR of different types of assets and various portfolios
• B) Value At Risk is measured in price
• C) All of the given options are correct
• D) VaR is applicable to stocks, bonds, currencies, derivatives, or any other assets with the price

If a Pakistani exporter experiences an appreciation in Pakistani currency, the prices of all goods produced in Pakistan will likely to get ______________ for foreign importers.

• A) Competitive
• B) Expensive
• C) Economical
• D) Cheap

Which one of the following factors does not affect currency movements?

• A) Government interventions
• B) Geo-political events
• C) Firm specific factors
• D) Interest rates

Which of the following financial instruments embeds a certain degree of currency hedging?

• A) Debentures
• B) Equities
• C) Bonds
• D) None of the given options is correct

______________________ is the process by which international companies with significant cross-border transactions implement strategies to limit their exposure to foreign exchange fluctuations.

• A) Currency management
• B) International management
• C) Project management
• D) All of the given options are correct

Earnings at risk is the amount of change in net income over a period of time due to change in __________.

• A) All of the given options are correct
• B) Interest rate
• C) Expenses
• D) Costs

The term____________ refers to evaluate a portfolio’s performance based on past returns.

• A) Ex-factor
• B) Ex-post
• C) Ex-ante
• D) Ex-finance

In behavioral finance, Rationality refers to:

• A) Reasoning
• B) Human Error
• C) All of the given options are correct
• D) Confidence level

Which of the following is/are the foundation(s) of market efficiency?

• A) Arbitrage
• B) All of the given options are correct
• C) Investor Rationality
• D) Independence of events