投资学第7版Test Bank答案
21. Suppose that the pre-tax holding period returns on two stocks are the same. Stock A has
a high dividend payout policy and stock B has a low dividend payout policy. If you are an individual in a high marginal tax bracket and do not intend to sell the stocks during the holding period, __________.
A) stock A will have a higher after-tax holding period return than stock B
B) the after-tax holding period returns on stocks A and B will be the same
C) stock B will have a higher after-tax holding period return than stock A
D) it is impossible to determine which stock will have a higher after-tax holding period
return given the information available
E) none of the above
Answer: C Difficulty: Moderate
Rationale: Taxes are not paid on capital gains until the stock is sold. If the pre-tax
holding period returns on the two stocks are the same, more taxes will be paid on the stock with the high dividend payout policy (stock A) and thus the after-tax returns of A will lower than the after-tax returns of B.
22. The prudent man law requires __________.
A) executives of companies to avoid investing in options of companies by which they
are employed
B) executives of companies to disclose their transactions in stocks of companies by
which they are employed
C) professional investors who manage money for others to avoid all risky investments
D) professional investors who manage money for others to constrain their investments
to those that would have been approved by the prudent investor
E) none of the above
Answer: D Difficulty: Moderate
Rationale: The prudent man rule allows one to diversify, which means that some risky
investments are allowed in a portfolio. However, the riskiness of the portfolio should be such that a prudent investor would be willing to assume.
23. The longest time horizons are likely to be set by
A) banks.
B) property and casualty insurance companies.
C) pension funds
D) A and C
E) B and C
Answer: C Difficulty: Moderate
Rationale: Banks and non-life insurance companies typically have short time horizons.
See Table 26.3.
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