# doubt ...Smagician sir or any one else pls help.....

The hypothesis testing of sample resulted in a p value of 0.00456. This implies that Choose one answer. a. The null hypothesis can be accepted with 99% confidence b. The null hypothesis can be rejected with 99% confidence

c. The null hypothesis can be rejected with 95% confidence

The correct answer is “B” but i feel “C” is also correct .Can any one please explain me

2nd)

Which of the following statements regarding the dividend policy of a firm is least accurate? Choose one answer. a. In case of stock splits, the ownership of a stockholder increases as he owns a greater number of shares of the firm now b. In case of stock splits, the ownership of a stockholder decreases as he owns a lesser percentage of shares of the firm now c. In case of stock splits, the ownership of a stockholder remains unchanged The correct answer is Soln: C In case of stock splits, the number of stocks owned by an investor increases but his ownership remains unchanged. I think the wordings of this question is quite “confusing”.What should be the correct answer?? 3) A Futures barley contract required an initial margin deposit of \$200 and a maintenance margin of 155. If the value of the contract falls to 150, what is the amount of margin that needs to be deposited to the clearing house and what is this margin called Choose one answer. a. \$45 / Maintenance margin b. \$50 / Maintenance margin c. \$50 / Variation Margin The correct answer is Soln: C Since the value of contract fell below the maintenance margin an amount of (200-150) = \$50 needs to be deposited. I think the answer should be “C” 4) An 8 year 6% semiannual bond is trading at \$1030. If the bond can be called after 3 years at \$1010; the yield to call of the bond is closest to: Choose one answer. a. 5.53% b. 2.46% c. 4.91% The correct answer is Soln: C N = 3*2 I/Y = ? PV = -1030 PMT = 60/2 FV = 1000 Yield to call = 2.46* 2 = 4.91% Incorrect Marks for this submission: 0/1. I think the solution for this question is not correct…FV=1010 not 1000…AM i correct?

any one ??

1. The most correct answer is B. C is also correct but you have to take the answer which most accurately resembles the reality of the question. If the p value was .00456 the maximum confidence interval which could be used to reject the null would be 1-p = 99.544%. The 99% interval captures this most closely. 95% less closely and 90% even less and so on. After this level of 99.544% you would not be able to reject the null. It is a poorly worded question imo and I feel they might be trying to catch somebody offguard who might have read .00456 as .0456 and would have selected C.

2. C should be correct but are you sure the question says least accurate or most accurate? If it was least accurate like you wrote, both A and B are equally correct. Ownership = % owned by the holder, this doesn’t change in a stock split because you are getting the same proportion of shares held prior to the split of the new total shares. Number of stocks owned does increase because the company is issuing more shares at a diluted price equal to the P / conversion factor.

3. It says the correct answer is C 50/Variation margin which I agree with and you also state is the correct answer…? What is the problem there? If you mistyped and think A or B is correct, margin definitions are…

Initial margin = margin required for trading, initiating and executing the futures contract

Maintenance margin = margin at which the account value can fall to without depositing more.

Variation margin = if your account value falls below maintenance margin you must deposit the difference of the value of the contract and intial margin to bring it back up. For stock margins however you only need to bring it back up to maintenance margin. Futures it is INITIAL MARGIN

1. To me there seems to be an error on this one. I plugged in the values using 1010 as the FV and got ~2.609 as the semi annual yield.

THANKS…I think for question number 3 they did a mistake,the answer is C but in the options they have marked a "X"SO i was confused…

Not a problem rahul roy. Are these questions from Schweser q bank and if so where?

not from q bank…one of my friend gave me this questions…