International Equity Markets

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Question 1
Free
True/False

In a dealer market,the broker takes the trade through the dealer,who participates in trades as a principal by buying and selling the security for his own account.

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True

False

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Question 2
Free
True/False

Public traders do not trade directly with one another in a dealer market.

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True

False

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Question 3
Free
Multiple Choice

The sale of new common stock by corporations to initial investors occurs in

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A

the primary market.

B

the secondary market.

C

the OTC market.

D

the dealer market.

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Question 4
Free
Multiple Choice

The sale of previously issued common stock traded between investors occurs in

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A

the primary market.

B

the secondary market.

C

the on-the-run market.

D

the dealer market.

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Question 5
Free
Multiple Choice

A "primary" stock market is

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A

a big internationally-important market like the NYSE.

B

a market where corporations issue new shares to initial investors.

C

where brokers and market makers trade.

D

none of the above

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Question 6
Multiple Choice

The market capitalization of the developed world

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A
is about 90 percent of the market capitalization of the entire world.
B
is about 80 percent of the market capitalization of the entire world.
C
is about 70 percent of the market capitalization of the entire world.
D
is about 60 percent of the market capitalization of the entire world.
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Question 7
Multiple Choice

The market capitalization of the developing world

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A
is about 80 percent of the market capitalization of the entire world.
B
is about 60 percent of the market capitalization of the entire world.
C
is about 40 percent of the market capitalization of the entire world.
D
is about 20 percent of the market capitalization of the entire world.
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Question 8
Multiple Choice

In general,Standard & Poor's Emerging Markets Data Base classified a stock market as "emerging" if

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A
it is located in a low- or middle-income economy as defined by the World Bank.
B
its investable market capitalization is low relative to its most recent GNI figures.
C
either a) or b)
D
none of the above
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Question 9
Multiple Choice

Investment in foreign equity markets

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A
is no longer considered a "backwater" in the field of Finance.
B
became common practice in the 1980s as investors diversified their portfolios.
C
during the 1980s was largely confined to the developed world.
D
all of the above
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Question 10
Multiple Choice

During the 1980s,cross-border equity investment was largely confined

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A
to the equity markets of developed countries.
B
to the emerging equity markets.
C
to the equity markets of the former Soviet Union.
D
none of the above
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Question 11
Multiple Choice

In mutual funds,investment in emerging foreign equity markets

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A
represents less than one percent of investments in U.S.-based mutual funds.
B
represents about five percent of investments in U.S.-based mutual funds.
C
represents more than twenty percent of investments in U.S.-based mutual funds.
D
declined during the 1990s.
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Question 12
Multiple Choice

Only in the _______ did world investors start to invest sizable amounts in the emerging equity markets,as the economic growth and prospects of the developing countries improved.

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A
1960s
B
1970s
C
1980s
D
1990s
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Question 13
Multiple Choice

Which investment is likely to be the most liquid?

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A
A share of publicly traded company trading on the NYSE.
B
A bond issued by a Fortune 500 company.
C
A house in a nice part of town.
D
a) and b) are equally liquid
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Question 14
Multiple Choice

Which investment is likely to be the least liquid?

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A
A share of publicly traded company trading on the NYSE.
B
A bond issued by a Fortune 500 company.
C
A house in a nice part of town.
D
a) and b) are equally liquid
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Question 15
Multiple Choice

A liquid stock market

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A
is one in which prices reflect all relevant information quickly.
B
is one in which prices reflect all publicly available information quickly.
C
is one in which prices reflect price and volume information quickly.
D
is one in which investors can buy and sell stocks quickly at close to the current quoted prices.
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Question 16
Multiple Choice

A measure of liquidity for a stock market is the turnover ratio; defined as

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A
the ratio of stock market transactions over a period of time divided by the size, or market capitalization, of the stock market.
B
the ratio of the size, or market capitalization, of the stock market divided by the value of the stock market transactions over a period of time.
C
the ratio of aggregate company sales over a period of time divided by the size, or market capitalization, of the stock market.
D
none of the above
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Question 17
Multiple Choice

Generally,the higher the turnover ratio,

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A
the less liquid the secondary stock market, indicating ease in trading.
B
the more liquid the secondary stock market, indicating ease in trading.
C
the more liquid the primary stock market, indicating ease in trading.
D
the more efficient the stock market is.
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Question 18
Multiple Choice

The turnover ratio percentages for 27 equity markets of developed countries for the five years beginning with 2002 were measured.Most national equity markets had very high turnover ratios,with the great majority in excess of

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A
15 percent turnover per year.
B
25 percent turnover per year.
C
50 percent turnover per year.
D
75 percent turnover per year.
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Question 19
Multiple Choice

The turnover ratio percentages for 36 equity markets of emerging markets for the five years beginning with 2002 were measured.Many of the small equity markets in each region (e.g.,Peru,Venezuela,Sri Lanka,Slovak Republic,Croatia,and Zimbabwe)have relatively low turnover ratios,

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A
indicating poor liquidity at present.
B
indicating good liquidity at present.
C
indicating strong investment performance over the period.
D
none of the above
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Question 20
Multiple Choice

A measure of "liquidity" for a stock market is

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A
the times interest earned ratio.
B
the ratio of stock market transactions over a period of time divided by the size, or market capitalization, of the stock market.
C
the LIBOR rate.
D
both a) and b)
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