The Markowitz Model does not depend on the assumption of normally distributed
security returns.
Present value is based on the concept of:
compoundingsystematic riskdurationdiscounting
A 25-year old college graduate is participating in a 401(k) retirement plan and wishes to
minimize risk by eliminating stock-based mutual funds and other equities from his
investment portfolio. What will this probably do to his ending retirement funds in 40
years?
What are the five competitive factors identified in the Michael Porter model?
Modigliani-squared is a return adjusted for volatility that allows returns between
portfolios to be compared.
What is meant by “quality of earnings,” and how does it affect the equity analyst’s job?
A probability distribution shows the likely outcomes that may occur and the
probabilities associated with these likely outcomes.
John Crossborder buys 1 share of Telmex at 140 pesos when the value of the peso is
stated in dollars at $0.35. One year later, Telmex is selling for 155 pesos and paid a
dividend of 5 pesos during the year. If after 1 year the value of the pesos is $0.29, what
will John’s rate of return be in U. S. dollars?