Financial Engineering Aptitude Test
FEAT 1
Team Latte
Nov 22, 2005
Problem 1
Fill in the blanks where there is a question mark sign
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Problem 2
Fill in the blanks where there is a question mark sign
Problem 3
Fill in the blanks where there is a question mark sign
f(1) = 0 |
f(-1) = -2 |
f(2) = 0 |
f(-2) = -9 |
f(-13) = ? |
Problem 4
Your boss asks you a question: " what is 2 + 2 ?"
Your reply will be:
(a) 4
(b) somewhere between 3 and 5
(c) certainly greater than 2.5
(d) I am not sure, but it is highly likely to be in and around 3.5
Problem 5
An electronic gadget sells for $2 today. You are unsure whether the price will go up or down in one year's time but there is an equal chance of it going up or down. You reckon that in any case the price will be in the range of $1.75 to $2.50 a year from now. You approach the sales person and reserve the gadget for one year by paying 30 cents as the cost of reservation. And by doing so you agree with the sales person that if you buy the gadget in exactly one year from now you would pay a price of $1.50 for the commodity. However, if you don't buy the gadget in a year's time then you will forfeit the 30 cents that you pay today. You are aware that if in a year's time you buy the gadget then you may need to borrow money from the bank and currently the interest rate on such borrowing is 5%
Did you pay a fair price for reserving this gadget?
  
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