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Financial Markets Flashcards | StudBud
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Financial Markets
Financial Markets
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1
Which of the following behavioral biases is a tendency to hold a false assessment of skill, intellect, or talent?
Representative Bias
Anchoring Bias
Hindsight Bias
Overconfidence Bias
2
An investment is any asset in which money can be placed with the expectation that it will ______?
reduce future consumption
generate income payments
decrease in value
require income payments
3
Which of the following represents ownership in a company and entitles the shareholder to voting rights?
Commercial paper
Corporate bond
Common stock
Preferred debt
4
Which financial security obtains its value from the price behavior of another underlying asset?
Derivative
Certificate of Deposit
Bond
Stock
5
Which of the following is NOT considered a financial asset?
stock
derivative
bond
precious metal
6
What are the three basic ways in which stock prices adjust to unexpected news or events?
Gradual Reaction, Immediate Adjustment, Efficient Correction
Quick Response, Delayed Adjustment, Price Overreaction
Efficient Reaction, Delayed Reaction, Overreaction and Correction
Efficient Reaction, Gradual Reaction, Underreaction
7
Which capital market facilitates the sale of long-term fixed income financial products?
Money Markets
Equity Markets
Derivative Markets
Debt Markets
8
What is the defining characteristic of a Semi-strong-form Efficient Market?
Historical information is crucial for beating the market.
Prices reflect all information, both public and private.
Prices reflect all historical information.
Prices reflect all public information.
9
If the number of Apple shares that investors want to buy is less than those that want to sell, the price will _____.
stay the same
decrease
increase
10
Which of the following is generally categorized as an unsophisticated financial market participant?
Corporations
Depository Financial Institutions
Retail Investors
Governments
