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1. Which of the following models for mathematics of the financial markets is dependent on expectations or probabilities of changes in the value of an underlying asset?    A. Monte Carlo Simulation   B. Black Scholes Model   C. Cox-Ross-Rubinstein Model       2. Models for the financial markets are primarily used for all of the following, except,    A. Algorithmic Trading   B. Technical Analysis (Short term trading)   C. Fundamental Analysis (Long term investing   D. All of the above     3. Which among the following organizations use financial mathematics as part of their core operation?    A. Investment banks   B. Government   C. Hedge funds   D. All of the above     4. S1: Quantitative finance helps to allocate resources to provide the optimum returns. S2: Financial models are accurate.    A. Both statements are true   B. Both statements are false   C. Only statement 1 is true   D. Only statement 2 is true     5. If there's an expected down move of an investment, the difference should be multiplied with the probability and deducted from the overall up move, then, discounted back to get the price of options using the binomial model.    A. False   B. True

1. Which of the following models for mathematics of the financial markets is dependent on expectations or probabilities of changes in the value of an underlying asset?    A. Monte Carlo Simulation   B. Black Scholes Model   C. Cox-Ross-Rubinstein Model       2. Models for the financial markets are primarily used for all of the following, except,    A. Algorithmic Trading   B. Technical Analysis (Short term trading)   C. Fundamental Analysis (Long term investing   D. All of the above     3. Which among the following organizations use financial mathematics as part of their core operation?    A. Investment banks   B. Government   C. Hedge funds   D. All of the above     4. S1: Quantitative finance helps to allocate resources to provide the optimum returns. S2: Financial models are accurate.    A. Both statements are true   B. Both statements are false   C. Only statement 1 is true   D. Only statement 2 is true     5. If there's an expected down move of an investment, the difference should be multiplied with the probability and deducted from the overall up move, then, discounted back to get the price of options using the binomial model.    A. False   B. True

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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1. Which of the following models for mathematics of the financial markets is dependent on expectations or probabilities of changes in the value of an underlying asset? 
 
A. Monte Carlo Simulation
 
B. Black Scholes Model
 
C. Cox-Ross-Rubinstein Model
 
 
 
2. Models for the financial markets are primarily used for all of the following, except, 
 
A. Algorithmic Trading
 
B. Technical Analysis (Short term trading)
 
C. Fundamental Analysis (Long term investing
 
D. All of the above
 
 
3. Which among the following organizations use financial mathematics as part of their core operation? 
 
A. Investment banks
 
B. Government
 
C. Hedge funds
 
D. All of the above
 
 
4. S1: Quantitative finance helps to allocate resources to provide the optimum returns. S2: Financial models are accurate. 
 
A. Both statements are true
 
B. Both statements are false
 
C. Only statement 1 is true
 
D. Only statement 2 is true
 
 
5. If there's an expected down move of an investment, the difference should be multiplied with the probability and deducted from the overall up move, then, discounted back to get the price of options using the binomial model. 
 
A. False
 
B. True
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