Question 1

Index funds,while trying to match market performance,consistently underperform market benchmarks.

Accepted Answer

A) True 
 B)False

Question 2

A no-load fund has no

Accepted Answer

A)  sales charges. 
B)  administrative charges. 
C)  management charges. 
D)  tax charges. 
E)  12(b)-1 fees. 
A)  sales charges. 
B)  administrative charges. 
C)  management charges. 
D)  tax charges. 
E)  12(b)-1 fees.

Question 3

It is almost impossible to lose money in a mutual fund as the result of fraud or the mutual fund company's bankruptcy.

Accepted Answer

A) True 
 B)False

Question 4

Closed-end investment companies are characterized by

Accepted Answer

A)  number of shares determined by demand. 
B)  price based on net asset value per share. 
C)  variable transaction costs. 
D)  availability for sale or purchase on security markets. 
E)  value dependent on quantity of shares held. 
A)  number of shares determined by demand. 
B)  price based on net asset value per share. 
C)  variable transaction costs. 
D)  availability for sale or purchase on security markets. 
E)  value dependent on quantity of shares held.

Question 5

Exchange traded funds can create new shares to meet demand.

Accepted Answer

A) True 
 B)False

Question 6

When you buy shares in a load fund,you will pay the NAV.

Accepted Answer

A) True 
 B)False

Question 7

The KLM Mutual Fund has a net asset value of $12.34 and an offer price of $13.34.Use this information to answer the following questions.(Show all work.)
a.How many shares will you receive when you invest $1,000?
b.What is the immediate asset value of these shares?
c.What is the load charge for this transaction?

Accepted Answer

a.investment/offer price: $1,0

Question 8

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 9

A closed-end investment company that invests in various types of real estate and mortgages is a

Accepted Answer

A)  hybrid real estate investment trust. 
B)  blind pool syndicate. 
C)  real estate general partnership. 
D)  hybrid limited partnership. 
E)  mortgage real estate investment trust. 
A)  hybrid real estate investment trust. 
B)  blind pool syndicate. 
C)  real estate general partnership. 
D)  hybrid limited partnership. 
E)  mortgage real estate investment trust.

Question 10

Mutual funds do not offer

Accepted Answer

A)  automatic reinvestment plans. 
B)  guaranteed performance. 
C)  regular income programs. 
D)  conversion privileges. 
E)  retirement plans. 
A)  automatic reinvestment plans. 
B)  guaranteed performance. 
C)  regular income programs. 
D)  conversion privileges. 
E)  retirement plans.

Question 11

If a mutual fund provides for automatic reinvestment,the reinvested dividends will not be taxed until the shares are redeemed.

Accepted Answer

A) True 
 B)False

Question 12

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-The value of your shares in a closed-end fund is determined by [the fund's NAV | supply and demand factors].

Accepted Answer

The answer of Choose the word or phrase in [...

Question 13

Redeeming your mutual fund shares might result in a charge called

Accepted Answer

A)  a back-end load. 
B)  a front-end load. 
C)  a redemption tax. 
D)  a management fee. 
E)  none of these. 
A)  a back-end load. 
B)  a front-end load. 
C)  a redemption tax. 
D)  a management fee. 
E)  none of these.

Question 14

A guarantee of expected fund's future performance is its past performance.

Accepted Answer

A) True 
 B)False

Question 15

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-A quotation for a mutual fund shows a NAV of $9.60 and an offer price of $10.00.With an investment of $1,000,you could buy [104.17 | 100] shares.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 16

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-Advantages of exchange traded funds over mutual funds include [narrow | broad] industry selection.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 17

The objective of bond and money market funds is growth.

Accepted Answer

A) True 
 B)False

Question 18

Asset allocation funds invest money in

Accepted Answer

A)  stocks 
B)  bonds 
C)  real estate 
D)  a and b only 
E)  all of the above 
A)  stocks 
B)  bonds 
C)  real estate 
D)  a and b only 
E)  all of the above

Question 19

Mutual fund conversion privileges can often be exercised using 800 numbers.

Accepted Answer

A) True 
 B)False

Question 20

A closed-end investment company can create an unlimited number of shares.

Accepted Answer

A) True 
 B)False

Index funds,while trying to match market performance,consistently underperform market benchmarks.

A no-load fund has no

It is almost impossible to lose money in a mutual fund as the result of fraud or the mutual fund company's bankruptcy.

Closed-end investment companies are characterized by

Exchange traded funds can create new shares to meet demand.

When you buy shares in a load fund,you will pay the NAV.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

A closed-end investment company that invests in various types of real estate and mortgages is a

Mutual funds do not offer

If a mutual fund provides for automatic reinvestment,the reinvested dividends will not be taxed until the shares are redeemed.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -The value of your shares in a closed-end fund is determined by [the fund's NAV | supply and demand factors].

Redeeming your mutual fund shares might result in a charge called

A guarantee of expected fund's future performance is its past performance.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Advantages of exchange traded funds over mutual funds include [narrow | broad] industry selection.

The objective of bond and money market funds is growth.

Asset allocation funds invest money in

Mutual fund conversion privileges can often be exercised using 800 numbers.

A closed-end investment company can create an unlimited number of shares.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters

Exam 13: Investing in Mutual Funds

Index funds,while trying to match market performance,consistently underperform market benchmarks.

A no-load fund has no

It is almost impossible to lose money in a mutual fund as the result of fraud or the mutual fund company's bankruptcy.

Closed-end investment companies are characterized by

Exchange traded funds can create new shares to meet demand.

When you buy shares in a load fund,you will pay the NAV.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

A closed-end investment company that invests in various types of real estate and mortgages is a

Mutual funds do not offer

If a mutual fund provides for automatic reinvestment,the reinvested dividends will not be taxed until the shares are redeemed.

Redeeming your mutual fund shares might result in a charge called

A guarantee of expected fund's future performance is its past performance.

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement. -Advantages of exchange traded funds over mutual funds include [narrow | broad] industry selection.

The objective of bond and money market funds is growth.

Asset allocation funds invest money in

Mutual fund conversion privileges can often be exercised using 800 numbers.

A closed-end investment company can create an unlimited number of shares.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters