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8006 Exam Dumps - PRMIA PRM Certification Questions and Answers

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Questions 4

The rate of dividend on a stock goes up. What is the effect on the price of a put option on this stock?

Options:

A.

It may affect the put value either way depending upon the risk-free rate

B.

It increases the value of the put

C.

It decreases the value of the put

D.

It does not affect the value of the put

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Questions 5

Which of the following relationships are true:

I. Delta of Put = Delta of Call - 1

II. Vega of Call = Vega of Put

III. Gamma of Call = Gamma of Put

IV. Theta of Put > Theta of Call

Assume dividends are zero.

Options:

A.

I, II, III and IV

B.

II and IV

C.

I and III

D.

I, II and III

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Questions 6

How will the Macaulay duration of a 10 year coupon bearing bond change if 10 year zero rates stay the same but the yield curve changes from being flat to upward sloping?

Options:

A.

Will decrease

B.

Will increase

C.

Will be unaffected

D.

Cannot say without more information

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Questions 7

Identify the underlying asset in a treasury bond futures contract?

Options:

A.

Any long term US Treasury bond with a maturity of more than 15 years and not callable within 15 years

B.

Any long term US Treasury note with a maturity between 6.5 years and 10 years from the date of delivery

C.

Any long term US Treasury bond with a maturity of more than 10 years and not callable within 10 years

D.

Any of the above, with the price adjusted with the coupon and maturity date of the bond delivered

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Exam Code: 8006
Exam Name: Exam I: Finance Theory Financial Instruments Financial Markets - 2015 Edition
Last Update: Nov 21, 2024
Questions: 287
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