Question 1

The _____ tracks the stock prices of some of the largest and most actively traded companies listed on the Tokyo Stock Exchange.

Accepted Answer

A) Nikkei 225 
B) SSE Composite 
C) Standard & Poor's 500 
D) FTSE 100 
A) Nikkei 225 
B) SSE Composite 
C) Standard & Poor's 500 
D) FTSE 100 A

Question 2

A drawback of actively managed funds is:

Accepted Answer

A) that mutual funds that are not specialized do not offer enough diversification. 
B) that significant tax consequences occur when there is a lot of trading. 
C) the difficulty in redeeming shares from the fund. 
D) the uncertainty of recovering at least a portion of the initial investment. 
A) that mutual funds that are not specialized do not offer enough diversification. 
B) that significant tax consequences occur when there is a lot of trading. 
C) the difficulty in redeeming shares from the fund. 
D) the uncertainty of recovering at least a portion of the initial investment. B

Question 3

Explain how securities are issued in the primary market and traded on secondary markets.

Accepted Answer

​The primary market is where corporations obtain financial capital by selling newly issued securities. There are two different ways securities can be sold in primary markets. In public offerings, the securities are sold to the general public. In private placements, the securities are sold to a select group of accredited investors who meet specific requirements set by the Securities and Exchange Commission. Most firms hire a financial intermediary known as an investment bank to help them sell securities in the primary market. Secondary markets are where previously issued securities are traded. The corporations that issue stocks and bonds do not receive any funds from sales on the secondary market. The two major types of secondary markets are securities exchanges and the over-the-counter-market. Exchanges only list stocks of corporations that satisfy their listing requirements and pay listing fees. The stocks of corporations not listed on an exchange are sold on the over-the-counter-market through a network of securities dealers.

Question 4

A(n)_____ is an example of a depository institution.

Accepted Answer

A)  commercial bank​ 
B) investment bank 
C) mutual fund 
D) insurance company 
A)  commercial bank​ 
B) investment bank 
C) mutual fund 
D) insurance company

Question 5

List any two depository and nondepository institutions and describe their differences.

Accepted Answer

​Depository institutions are financial i

Question 6

The par value of a bond is the value of that bond at its maturity. It represents what a firm must pay the bondholder when the bond matures.

Accepted Answer

A) True 
 B)False

Question 7

Which of the following is a disadvantage of strongly relying on market timing?

Accepted Answer

A) It requires the investor to make frequent trades. 
B) It has steady but very low returns because the investments are low risk. 
C) It requires huge, long term-investments on a single company, thus accentuating the risk. 
D) It is very time consuming and takes a very long time to get the returns. 
A) It requires the investor to make frequent trades. 
B) It has steady but very low returns because the investments are low risk. 
C) It requires huge, long term-investments on a single company, thus accentuating the risk. 
D) It is very time consuming and takes a very long time to get the returns.

Question 8

Discuss the appeal to investors of mutual funds and exchange traded funds.

Accepted Answer

​Though they are actually created throug

Question 9

Discuss how the government regulates securities markets.

Accepted Answer

​The securities industry is subject to s

Question 10

National Association of Securities Dealers Automated Quotation System (NASDAQ)is a physical location where brokers meet to buy and sell stocks for their clients.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following is true of personal investing?

Accepted Answer

A) Every security investment will generate money. 
B) In general, riskier investment strategies offer the potential for higher returns. 
C) Diversification is a personal investment strategy that increases the expected rate of return and risk. 
D) Individuals who invest in securities must use the services of an investment bank. 
A) Every security investment will generate money. 
B) In general, riskier investment strategies offer the potential for higher returns. 
C) Diversification is a personal investment strategy that increases the expected rate of return and risk. 
D) Individuals who invest in securities must use the services of an investment bank.

Question 12

The _____ of 2010 expanded the Fed's regulatory authority over nondepository financial institutions, such as hedge funds and mortgage brokers that had previously operated with little regulatory oversight or accountability.

Accepted Answer

A) Sarbanes-Oxley Act 
B) Dodd-Frank Act 
C) Glass-Steagall Act 
D) Gramm-Bliley-Leach Act 
A) Sarbanes-Oxley Act 
B) Dodd-Frank Act 
C) Glass-Steagall Act 
D) Gramm-Bliley-Leach Act

Question 13

Dividends to common stockholders of a company are:

Accepted Answer

A) a distribution of earnings that are paid only if declared by the company's board of directors. 
B) a legally required payment to the company's shareholders. 
C) a tax-deductible expense. 
D) the result of a rise in the market price of the firm's stock in the secondary market. 
A) a distribution of earnings that are paid only if declared by the company's board of directors. 
B) a legally required payment to the company's shareholders. 
C) a tax-deductible expense. 
D) the result of a rise in the market price of the firm's stock in the secondary market.

Question 14

The Federal Deposit Insurance Corporation was established by the Banking Act of 1933 and insures depositors against financial loss if a bank fails.

Accepted Answer

A) True 
 B)False

Question 15

In order to determine market cap, the total market value of all shares of common stock outstanding of a company, an individual should:

Accepted Answer

A) multiply the number of shares outstanding by the price per share. 
B) look at the total assets on the balance sheet of the firm. 
C) calculate the net worth of the firm. 
D) divide the number of shares outstanding by the par value per share. 
A) multiply the number of shares outstanding by the price per share. 
B) look at the total assets on the balance sheet of the firm. 
C) calculate the net worth of the firm. 
D) divide the number of shares outstanding by the par value per share.

Question 16

How does an investor typically track the performance of specific stocks?

Accepted Answer

​Although most major city newspapers sti

Question 17

Which of the following is true of a securities broker?

Accepted Answer

A) They sell securities for higher prices than they paid to purchase them. 
B) They collect premiums from policy holders. 
C) They act as agents for investors who want to buy or sell financial securities. 
D) They issue new securities to raise financial capital. 
A) They sell securities for higher prices than they paid to purchase them. 
B) They collect premiums from policy holders. 
C) They act as agents for investors who want to buy or sell financial securities. 
D) They issue new securities to raise financial capital.

Question 18

A _________ issued by an investor instructs a broker to buy or sell a security at the current market price.

Accepted Answer

A) market order 
B) limit order 
C) safe order 
D) security order 
A) market order 
B) limit order 
C) safe order 
D) security order

Question 19

An investment banker's main responsibility is to help firms work out the financial details of issuing new securities before a public offering. This can include assisting the firm with the planning and market assessment phase, providing assistance with SEC details, and deciding whether to sell the stock via a firm commitment or a best efforts approach.

Accepted Answer

A) True 
 B)False

Question 20

The FTSE 100 is an index of the stock prices of the largest traded companies on the London Stock Exchange.

Accepted Answer

A) True 
 B)False

The _____ tracks the stock prices of some of the largest and most actively traded companies listed on the Tokyo Stock Exchange.

A drawback of actively managed funds is:

Explain how securities are issued in the primary market and traded on secondary markets.

A(n)_____ is an example of a depository institution.

List any two depository and nondepository institutions and describe their differences.

The par value of a bond is the value of that bond at its maturity. It represents what a firm must pay the bondholder when the bond matures.

Which of the following is a disadvantage of strongly relying on market timing?

Discuss the appeal to investors of mutual funds and exchange traded funds.

Discuss how the government regulates securities markets.

National Association of Securities Dealers Automated Quotation System (NASDAQ)is a physical location where brokers meet to buy and sell stocks for their clients.

Which of the following is true of personal investing?

The _____ of 2010 expanded the Fed's regulatory authority over nondepository financial institutions, such as hedge funds and mortgage brokers that had previously operated with little regulatory oversight or accountability.

Dividends to common stockholders of a company are:

The Federal Deposit Insurance Corporation was established by the Banking Act of 1933 and insures depositors against financial loss if a bank fails.

In order to determine market cap, the total market value of all shares of common stock outstanding of a company, an individual should:

How does an investor typically track the performance of specific stocks?

Which of the following is true of a securities broker?

A _________ issued by an investor instructs a broker to buy or sell a security at the current market price.

The FTSE 100 is an index of the stock prices of the largest traded companies on the London Stock Exchange.

Business Now: Change Is the Only Constant

Economics: The Framework for Business

The World Marketplace: Business Without Borders

Business Ethics and Social Responsibility: Doing Well by Doing Good

Business Communication: Creating and Delivering Messages that Matter

Business Formation: Choosing the Form that Fits

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product, Right Person, Right Place, Right Price

Management, Motivation and Leadership: Bringing Business to Life

Human Resources Management: Building a Top Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

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Exam 10: Financial Markets: Allocating Financial Resources

The _____ tracks the stock prices of some of the largest and most actively traded companies listed on the Tokyo Stock Exchange.

A drawback of actively managed funds is:

Explain how securities are issued in the primary market and traded on secondary markets.

A(n)_____ is an example of a depository institution.

List any two depository and nondepository institutions and describe their differences.

The par value of a bond is the value of that bond at its maturity. It represents what a firm must pay the bondholder when the bond matures.

Which of the following is a disadvantage of strongly relying on market timing?

Discuss the appeal to investors of mutual funds and exchange traded funds.

Discuss how the government regulates securities markets.

National Association of Securities Dealers Automated Quotation System (NASDAQ)is a physical location where brokers meet to buy and sell stocks for their clients.

Which of the following is true of personal investing?

The _____ of 2010 expanded the Fed's regulatory authority over nondepository financial institutions, such as hedge funds and mortgage brokers that had previously operated with little regulatory oversight or accountability.

Dividends to common stockholders of a company are:

The Federal Deposit Insurance Corporation was established by the Banking Act of 1933 and insures depositors against financial loss if a bank fails.

In order to determine market cap, the total market value of all shares of common stock outstanding of a company, an individual should:

How does an investor typically track the performance of specific stocks?

Which of the following is true of a securities broker?

A _________ issued by an investor instructs a broker to buy or sell a security at the current market price.

The FTSE 100 is an index of the stock prices of the largest traded companies on the London Stock Exchange.

Business Now: Change Is the Only Constant

Economics: The Framework for Business

The World Marketplace: Business Without Borders

Business Ethics and Social Responsibility: Doing Well by Doing Good

Business Communication: Creating and Delivering Messages that Matter

Business Formation: Choosing the Form that Fits

Small Business and Entrepreneurship: Economic Rocket Fuel

Accounting: Decision Making by the Numbers

Finance: Acquiring and Using Funds to Maximize Value

Marketing: Building Profitable Customer Connections

Product and Promotion: Creating and Communicating Value

Distribution and Pricing: Right Product, Right Person, Right Place, Right Price

Management, Motivation and Leadership: Bringing Business to Life

Human Resources Management: Building a Top Quality Workforce

Managing Information and Technology: Finding New Ways to Learn and Link

Operations Management: Putting It All Together

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