1. Economic analysis is generally viewed as an integral part of the top-down approach to security analysis. In this context, identify each of the following and note how each would probably behave in a strong economy. a. Fiscal policy b. Interest rates c. Industrial production d. Retail sales e. Producer prices

2. Describe each of the following approaches to technical analysis and note how it would be used by investors. a. Arms index b. Trading action c. Odd-lot trading d. Charting e. Moving averages f. On-balance volume

Which of these approaches is likely to involve some type of mathematical equation or ratio?

3. Briefly define each of the following and note the conditions that would suggest the market LG5 is technically strong. a. Breadth of the market b. Short interest c. Relative strength index (RSI) d. Theory of contrary opinion e. Head and shoulders

4. Select the security in the left-hand column that best fits the investor desire described in the right-hand column. a. Five-year Treasury note b. Bond with a low coupon and a long maturity c. Yankee bond d. Non-callable bond e. Asset-backed security f. Junk bond i. Lock in a high-coupon yield ii. Accumulate capital over a long period of time iii. Generate a monthly income iv. Avoid a lot of price volatility v. Invest in a foreign bond vi. Go for the highest yield available vii. Go for maximum price appreciation

5. A 12%, 20-year bond is currently trading at $1250. What is its current yield?

6. Which of the following three bonds offers the highest current yield? LG2 a. A 9.5%, 20-year bond quoted at 977.50 b. A 16%, 15-year bond quoted at 1646.25 c. A5.25%,18-yearbondquotedat540.00