B- False6. Active strategy is an investment policy that based on the premise that securities are fairlypriced, and it avoids the costs involved in undertaking security analysisA- True.B- False7. Examples of the company-specific influences are firm's success in R&D, itsmanagement style and philosophy, and so on.A- TrueB- False8. Some examples of macroeconomics variable that cause market risk are business cycles,inflation, interest rates, exchange rates, and so forth.A- TrucB- False

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6. Active strategy is an investment policy that based on the premise that securities are fairly priced, and it avoids the costs involved in undertaking security analysis A- True. B- False

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 2P

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Concept explainers

Classification Of Risk

Risk means when there could be a possibility that the returns expected from a particular project or investment may or may not match the investor's expectations. In other words, the uncertainty of an income arising from a source that would either be lower than expected or result in losses in risk exposure of the project. The higher the risk involved, the higher is the return expected by the investor as the investor is exposed to a high level of risk. There are various methods by which different types of risk can be assessed and avoided or mitigated.

Question

B- False
6. Active strategy is an investment policy that based on the premise that securities are fairly
priced, and it avoids the costs involved in undertaking security analysis
A- True.
B- False
7. Examples of the company-specific influences are firm's success in R&D, its
management style and philosophy, and so on.
A- True
B- False
8. Some examples of macroeconomics variable that cause market risk are business cycles,
inflation, interest rates, exchange rates, and so forth.
A- Truc
B- False

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