Question 1) How would you determine if a public corporation's financial statements are reliable?
Question 2) Briefly compare and contrast the primary market and the secondary markets. What type of investors participates in each market?
Question 3) A portfolio with a correlation of +1 is not a well-diversified portfolio. What must you do as an investor to structure a portfolio with negative correlation?
Question 4) Compare and contrast the Capital Asset Pricing Model (CAPM) and Arbitrage Pricing Theory (APT)? Which model is appropriate for calculating a stock's required rate of return?
Question 5) Are the financial markets efficient, and if so, under what form of the Efficient Market Hypothesis model?
Question 6) What macroeconomic variable do you believe has the greatest impact on interest rates? Briefly explain.
Question 7) What is a straddle? Would you use it when buying/writing options? Why?