First National Bank finds itself in a situation where it is receiving fixed rate income from its loan portfolio and must pay floating rate expenses to its depositors. Which of the following plain vanilla interest rate swap payments would be of interest to the bank?
I). First National makes fixed rate payments
II). First National makes floating rate payments
III). First National receives floating rate payments

ABC Corporation just paid a dividend of $1.25 per share. These dividends are expected to grow at
2 3% over the next three years and thereafter come in line with its long term normalized growth rate of 7%.
If investors currently require a 13% rate of return from this stock, what is the best estimate of ABC's current stock price?

In computing kurtosis, which of the following is true?
I). It raises the deviation from the mean to the fourth power.
II). The formula preserves the direction of the deviation.
III). Kurtosis measures how clustered the values in a distribution are to the mean.

Which of the following statements is (are) true with respect to insuring a portfolio by way of protective strategy?
I). The strategy requires the sale of put options while owning the underlying asset.
II). If the price of the underlying asset increases dramatically, then an insured portfolio will perform much better than an uninsured portfolio.
III). The cost of portfolio insurance will rise as the volatility of the underlying asset increases.
IV). The upside potential for an insured portfolio is unlimited.

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