MARIAN COLLEGE

Climaco St., Poblacion, Ipil,

Zamboanga Sibugay
College Department
Midterm Examination
(SY: 2021-2022)

Subject Descriptive Title: F/MGNT 312 – Investment and Portfolio Management

Instructor: Ma’am Guadalupe G. Edulan

Name:____________________________
Course/year:_______________________
Date:_____________________________
INSTRUCTIONS:
l. Read carefully each item in the test. For each item has a set of four choices from where you
could choose the correct letter of option that correspond to what you think is the best answer.
Circle the letter that represents your best answer.

1. Income minus expenditures equals?

A. Savings
B. Surplus
C. Investment
D. Deficit
2. When money is committed to another person for a period of time for earning higher returns, it
is called?
A. Savings
B. Surplus
C. Investment
D. Deficit
3. An Investment earns an income. This income is called return. The return is a compensation
for all of the following; EXCEPT:
A. The time period for which funds are committed.
B. Safety of funds
C. Uncertainty of future payment
D. The amount of inflation
4. The following are qualities of real assets; EXCEPT:
A. They are generally tangible
B. They are depreciated
C. They appear as liabilities
D. They can be used to produce other assets
5. The possibility that the return actually realized is lower than the return expected to be realized
is known as?
A. Financial investment
B. Financial risk
C. Return of investment
D. Savings
6. What is the difference between the sale price and the purchase price?
A. capital appreciation
B. Investment
C. Return of investment
D. Investment appreciation
7. Which of the following implies the certainty of return of capital without loss of money or time?
A. Return of investment
B. Financial investment
C. Safety of investment
D. Capital appreciation
8. An investment that easily saleable or marketable without loss of money is called?
A. Funds
B. Capital
C. Risk
D. Liquidity
9. Who are institutional investors in financial assets?
A. Investment Companies
B. Government
C. Insurance Companies
D. Commercial Banks
10. Higher return is associated with; which of the following?
A. Higher return
B. Higher risk
C. Higher Investment
D. All of the above
11. After much investigation an investor finds that Intel stock is currently under price. This is an
example of which of the following?
A. Security
B. return
C. Risk
D. Analysis
12. Shares that have lot of speculative trading are refer to which of the following
A. Speculative shares
B. Income share
C. Share of stocks
D. All of the above
13. Its aims is to provide capital appreciation over medium to long term. Generally, these funds
invest their money in equities. This is called?
A. Income scheme
B. Money scheme
C. Growth scheme
D. Index scheme
14. Which of the following is a favorite form of investment amongst the rural and semi-urban
population?
A. Building and Lots
B. Investment deposit
C. House and Lot
D. Gold and Silver
15. Which of the following is consider as real asset?
A. House and Lot
B. Gold and Silver
C. Machines
D. Cash money
16. The market mechanism for the buying and selling of new issues of securities is called?
A. Money market
B. Security market
C. Primary market
D. Secondary market
17. A centralized market for buying and selling stocks where the price is determined through
supply-demand mechanisms this is called?
A. Primary market
B. Security market
C. Stock exchange
D. Profitable exchange
18. What kind of system when buyers and sellers transact business face to face using a variety
of signals?
A. Market system
B. Floor trading system
C. Business trading
D. All of the above
19. A trader who applies for shares in the new issues market just like a genuine investor is
called?
A. Market trader
B. Bearer
C. Stag
D. Trading system
20. A trader who expects a rise in prices of securities is known as?
A. Bull Speculator.
B. Financial analyst
C. Financial security
D. All of the above

II. Fill in the blank

1. Industries and companies prosper during times of ______________.

2. The expansion of the industry mainly depends on the ________________.
3. ____________ is the largest investor and spender of money.
4. ____________ are more useful for economic forecasting because they measure
5. something that foreshadows a change in economic activity.
6. ____________ is the most precise and scientific of the different forecasting techniques.
7. ____________ is also known as GNP model building or sectoral analysis.
8. ____________ is an important part of fundamental analysis.
9. ____________ is an essential factor that determines the demand for the particular
product.
10. ____________Economies of scale and new market can be obtained only through.

III. Solve the Problem: (20 points)

SHARKEY CORPORATION
Selected Financial Data
As of December 31, 2007
2007 2006
Cash $ 8,000 $ 60,000
Marketable securities 32,000 8,000
Accounts receivable 40,000 110,000
Inventory 80,000 140,000
Net property, plant, and equipment 240,000 280,000
Accounts payable 60,000 100,000
Short-term notes payable 30,000 50,000
Cash sales 1,500,000 1,400,000
Credit sales 600,000 900,000
Cost of goods sold 1,260,000 1,403,000

Required:
A. Sharkey’s acid-test ratio as of December 31, 2007
B. Sharkey’s receivables turnover for 2007
C. Sharkey’s inventory turnover for 2007
D. Sharkey’s current ratio at December 31, 2007
E. If current assets exceed current liabilities, what will happen of payments to creditors made on the last
day of the year? Explain why.
1. Decrease current ratio.
2. Increase current ratio.
3. Decrease working capital.
4. Increase working capital.