Session 16

Question 1

Capital Market Line (5)

Answer 1

1- Expected return of the portfolio
2- Risk-free rate
3- Return on the market
4- Standard Deviation of the market
5- Standard deviation of the portfolio

Question 2

Security Market Line (4)

Answer 2

1- Expected Return for the Assets
2- Risk-free rate
3- return on the market
4- the beta of the asset

Question 3

Monte Carlo Simulation is well suited for: (3)

Answer 3

1- situation where no real-world data exists
2- problems with unknown variables
3- problems for which no analytical solution exists

Question 4

Weak Form Market Efficiency

Answer 4

states that current security prices fully reflect all current available security market data

Question 5

Semi-Strong Form Market Efficiency

Answer 5

price fully reflects all publicly available info

Question 6

Strong Form Market Efficiency

Answer 6

price reflect all public or private information