FIN 402 Final Exam Guide For more course tutorials visit www. uophelp. com
FIN 402 Final Exam Guide For more course tutorials visit www. uophelp. com
FIN 402 Investment Fundamentals and Portfolio Management Final Exam Guide
True / False 1.___ ___ The balance sheet shows what assets the firm controls at a point in time and how it financed the assets.
2.___ ___ Free cash flow = Cash flow from operations – Capital expenditures + Disposition of property and equipment.
3.___ ___ The income statement indicates the flow of sales, expenses, and earnings during a period of time.
4.___ ___ Financial ratios are used in stock and bond valuation models.
5.___ ___ A good portfolio is a collection of individually good assets.
6.___ ___ If the covariance of two stocks is positive, these stocks tend to move together over time.
7.___ ___ Increasing the correlation among assets in a portfolio results in an increase in the standard deviation of the portfolio. 8.___ __ In a three asset portfolio the standard deviation of the portfolio is one third of the square root of the sum of the individual standard deviations.