The situation in which the investment bank faces no risk of mispricing regarding security is considered as __________?

Related Mcqs:

1. Sum of market risk and diversifiable risk are classified as total risk which is equivalent to_______________?

   A. Sharpe’s alpha B. Standard alpha’s C. Alpha’s variance D. Variance...

2. An effect of interest rate risk and investment risk on a bond’s yield is classified as_________?

   A. Reinvestment premium B. Investment risk premium C. Maturity risk premium D. Defaulter’s premium...

3. Financial security with low degree risk and investment held by businesses is classified as________________?

   A. Treasury bills B. Commercial paper C. Negotiable certificate of deposit D. Money market mutual funds...

4. Positive minimum risk portfolio of any security shows that market security sold____________?

   A. Equal to original price B. Equal to sum of stocks C. Less than original price D. Greater than original price...

5. The issuance of securities in which investment bank does not guarantee back up price and act as distributor, in planning of issue is considered as ____________?

   A. best efforts offering B. least good index C. least good premium D. least good discount price...

6. The type of sale in which the investment bank got the rights to underwrite, distribute and originate new bonds is classified as __________?

   A. least effort sale B. effortless sale C. negotiated sale D. negotiated sale...

7. An unsystematic risk which can be eliminated but market risk is the__________?

   A. Aggregate risk B. Remaining risk C. Effective risk D. Ineffective risk...

8. According to market risk premium, an amount of risk premium depends upon investor______________?

   A. Risk taking B. Risk aversion C. Market aversion D. Portfolio aversion...

9. The bonds which are classified as junk bond status and have previously considered as investment grade bonds are called __________?

   A. risen angel B. fallen angel C. fallen devil D. risen devil...

10. If the price of municipal bonds suddenly changes because of an unexpected interest rate change then the investment bank ____________?

    A. faces a high profit B. faces a loss C. face a inflation D. face an index risk...