Chapter 12: DERIVATIVE SECURITIES
Very Short Question Answer 1. How a call option is different from put option? A call option gives its holders the right, but not the obligation, to buy the underlying security at the exercise price, while a put option gives its holders the right, but not the obligation, to sell the underlying security at the […]
Chapter 11: MANAGING PORTFOLIOS
Very Short Question Answer 1. Differentiate between asset allocation and diversification? Asset allocation emphasizes on investing into various assets classes while diversification emphasizes on selecting the securities to be included into a given asset class. Hence, investors can use asset allocation as a way to diversify their investments among asset classes. 2. What is the […]
Chapter:8 Leadership
Very Short Question and Answer 1. State the nature of leadership. Some of the key natures of leadership are enlisted as follows: Process of interpersonal influence Leaders and followers Common goals Continuous exercise Leadership is situational 2. 2074 Q.No. 8 State what trait theory says about leadership. One of the earliest theories to be developed […]
Chapter 10: Mutual Fund
Very Short Question Answer 1. Why the price of the shares of an open-end fund cannot fall below its net asset value? The price of shares of an open-end fund cannot fall below its net assets value because an open-end fund always stands ready to redeem shares at net asset value. 2. Briefly describe the […]
Chapter 10: Contemporary Issues
Very Short Question Answer of Contemporary Issues 1.Define the meaning of privatization. Privatization means the transfer of government assets and activities to the private sector. In other words, it is the involvement of private sector in the management of the public enterprise, or to sell, or lease it, or transfer government ownership to private ownership. […]
Chapter 9: Government Finance
Very Short Question Answer 1. Define the government budget. Government budget is defined as the estimate of income and expenditure by government for the coming fiscal year. 2. What are contains of the government budget? Contains of the budget are as follows: i. Actual income and expenditure of the previous fiscal year. ii. Revised income […]
Chapter 9: Bond Valuation
Very Short Question Answer 1. What do you mean by yield to call? An yield to call is the annualized rate of return that bondholders will realize if the bond is called at the stated date before the maturity. 2. What does bond’s duration indicate? Bond’s duration indicates the weighted average number of years that […]
Chapter 8: Fixed Income Securities
Very Short Question Answer 1. State the major features of fixed income securities and describe any one of them. Fixed income securities have various features such as an issuer, a maturity date, par value, and coupon. Coupon is the stated annual rate of interest that is paid on the par value of fixed income securities. […]
Chapter 7: Common Stock Analysis and Valuation
Very Short Answer Question 1. What is economic analysis? Economic analysis is the process of studying general state of economy to assess economic movements in country and their impact on stock price. In the process of economic analysis, we study the pattern of movement in macroeconomic variables to forecast how they affect specific industry and […]