Questions from General Investment

Q: Which sector would be more sensitive to the business cycle: industrials

Which sector would be more sensitive to the business cycle: industrials or health care?

Q: Why do you think that consumer sentiment is considered a leading economic

Why do you think that consumer sentiment is considered a leading economic indicator?

Q: Many health care companies depend on patents to sustain profits. In

Many health care companies depend on patents to sustain profits. In the context of Porter’s five forces, how would a patent expiration impact a health care firm?

Q: Which one of the following propositions would be consistent with a supply

Which one of the following propositions would be consistent with a supply-side view of fiscal policy? a. Higher marginal tax rates will help reduce the size of the budget deficit. b. A tax reduction w...

Q: She would like to compute the value of the corresponding put option

She would like to compute the value of the corresponding put option for Option 1. Which of the following is closest to Ms. Barlow’s answer? a. $3.79 b. $3.94 c. $4.41

Q: Regarding conditional prepayment rates (CPRs) and single monthly mortality (

Regarding conditional prepayment rates (CPRs) and single monthly mortality (SMM) rates, which of the following is most accurate? a. SMM is computed from the CPR to compute monthly prepayments. b. SMM...

Q: You write a put with a strike price of $60 on

You write a put with a strike price of $60 on stock that you have shorted at $60 (this is a “covered put”). What are the expiration date profits to this position for stock prices of $50, $55, $60, $65...

Q: You buy a call with a strike price of $70 on

You buy a call with a strike price of $70 on stock that you have shorted at $70 (this is a “protective call”). What are the expiration date profits to this position for stock prices of $60, $65, $70,...

Q: You simultaneously write a covered put and buy a protective call,

You simultaneously write a covered put and buy a protective call, both with strike prices of $80, on stock that you have shorted at $80. What are the expiration date payoffs to this position for stock...

Q: You simultaneously write a put and buy a call, both with

You simultaneously write a put and buy a call, both with strike prices of $80, naked, i.e., without any position in the underlying stock. What are the expiration date payoffs to this position for stoc...