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Devry FIN 351 Week 3 Quiz

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Question 1
3 pts
(TCO 3) The basic premise of _____ is that past trends in market movements can be used to forecast or understand the future.

  • the Efficient Market Hypothesis
  • fundamental analysis
  • technical analysis
  • None of the above

Question 2
3 pts
(TCO 3) Prior to the announcement of an acquisition until the acquisition takes effect, most likely the value of the stock of the acquiring company will _____.

  • rise sharply
  • rise sharply, then slowly fall
  • remain largely unchanged
  • fall slowly, then rise sharply

Question 3
3 pts
(TCO 3) Which of the following is a characteristic of an unfriendly takeover?

  • Usually, there is a high premium on stock price.
  • An unacceptable suitor attempts to buy out the target company.
  • A white knight may succeed in rescuing the target company.
  • All of the above

Question 4
3 pts
(TCO 3) Studies have shown that the best time to sell an unseasoned issue is _____.

  • prior to announcement of a merger
  • shortly after the initial distribution
  • after one year of trading
  • More than one of the above

Question 5
3 pts
(TCO 3) Research on the strong form shows that _____ are able to achieve superior returns.

  • members of the SEC
  • corporate insiders and public officials
  • market specialists and corporate insiders
  • the majority of professional mutual fund managers

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Question 6
3 pts
(TCO 3) The form of analysis that focuses on charts and graphs based on internal market data is called _____ analysis, while the form of analysis that emphasizes earnings reports, management capabilities, and new product development is called _____ analysis.

  • technical; fundamental
  • fundamental; technical
  • technical; external
  • technical; semi-strong

Question 7
3 pts
(TCO 3) All of the following are smart money rules except ¬_____.

  • investment advisory recommendations
  • short sales by specialists
  • Barron’s Confidence Index
  • None of the above

Question 8
3 pts
(TCO 3) As the ratio of specialist short sales to total short sales increases, technicians consider the market to be _____.

  • bullish
  • bearish
  • neutral
  • in the second leg of a bull market

Question 9
3 pts
(TCO 3) A point and figure chart is used to demonstrate _____.

  • advances and declines of stock prices
  • high, low, and closing price on a daily basis
  • changes of two points or more
  • More than one of the above

Question 10
3 pts
(TCO 3) Smart Money Rules include _____.

  • Barron’s Confidence Index
  • short sales by individuals
  • short sales by specialists
  • Both A and C