Question 1

Money market mutual funds

Accepted Answer

A)  are very risky investments. 
B)  require significant investments, so are out of reach of the common investor. 
C)  carry no loads. 
D)  None of the above. 
E)  Both A and B are correct 
A)  are very risky investments. 
B)  require significant investments, so are out of reach of the common investor. 
C)  carry no loads. 
D)  None of the above. 
E)  Both A and B are correct

Question 2

Provide a list of sources of information to evaluate mutual funds.

Accepted Answer

1.Morningstar Mutual Funds
2.T

Question 3

Which of the following services do ETF's offer?

Accepted Answer

A)  automatic reinvestment of dividends, interest, and capital gains 
B)  bookkeeping and tax help 
C)  phone and internet switching. 
D)  all of the above 
E)  None of the above 
A)  automatic reinvestment of dividends, interest, and capital gains 
B)  bookkeeping and tax help 
C)  phone and internet switching. 
D)  all of the above 
E)  None of the above

Question 4

What information can an investor find in the prospectus of a mutual fund?

Accepted Answer

A)  The fund's goal and investment strategy 
B)  The fund manager's past experience 
C)  The fund's 12b-1 fees 
D)  All of the above are correct. 
E)  Only A and B are correct. 
A)  The fund's goal and investment strategy 
B)  The fund manager's past experience 
C)  The fund's 12b-1 fees 
D)  All of the above are correct. 
E)  Only A and B are correct.

Question 5

What are the four choices for purchasing a mutual fund?

Accepted Answer

1.broker
2.financial

Question 6

Life cycle funds

Accepted Answer

A)  are designed for people with at least 20 years until retirement. 
B)  require you to decide how to allocate your investment among stocks, bonds, and money market instruments. 
C)  grow less conservative as your retirement date nears. 
D)  try to tailor their holding to the investor's individual age, and risk tolerance. 
A)  are designed for people with at least 20 years until retirement. 
B)  require you to decide how to allocate your investment among stocks, bonds, and money market instruments. 
C)  grow less conservative as your retirement date nears. 
D)  try to tailor their holding to the investor's individual age, and risk tolerance.

Question 7

All mutual funds carry the same level of diversification and exposure to risk.

Accepted Answer

A) True 
 B)False

Question 8

Bonnie and James are retired. They wish to continue to invest in their portfolio and are seeking income instead of growth. Which should they invest in?

Accepted Answer

A)  Growth funds 
B)  Bond funds 
C)  Sector funds 
D)  All of the above are correct 
E)  Only A and C are correct. 
A)  Growth funds 
B)  Bond funds 
C)  Sector funds 
D)  All of the above are correct 
E)  Only A and C are correct.

Question 9

A bond mutual fund is an appropriate choice for an investor with an income goal.

Accepted Answer

A) True 
 B)False

Question 10

By law, all mutual funds must be broadly diversified.

Accepted Answer

A) True 
 B)False

Question 11

A(n) ________ is a mutual fund company that has the ability to issue as many shares as investors are willing to purchase.

Accepted Answer

A)  closed-end mutual fund 
B)  share repurchase fund 
C)  open-end mutual fund 
D)  variable share mutual fund 
E)  none of the above 
A)  closed-end mutual fund 
B)  share repurchase fund 
C)  open-end mutual fund 
D)  variable share mutual fund 
E)  none of the above

Question 12

An equity REIT investment is limited to mortgages on income producing properties.

Accepted Answer

A) True 
 B)False

Question 13

One of the most valuable mutual fund services available is automatic reinvestment of cash flows.

Accepted Answer

A) True 
 B)False

Question 14

An index fund is a great choice for those who want to "beat the market."

Accepted Answer

A) True 
 B)False

Question 15

When you own shares in a mutual fund you make money in which of the following ways?

Accepted Answer

A)  As the value of all of the securities held by the mutual fund increase, the value of each mutual fund share also increases. 
B)  If a fund receives interest or dividends from its holdings this income is passed on to share holders. 
C)  If the fund sells a security for more than it originally paid for it, the shareholders receive this in the form of capital gains. 
D)  You receive a portion of the commissions that the fund manager charges for trades. 
E)  Only A, B and C are correct. 
A)  As the value of all of the securities held by the mutual fund increase, the value of each mutual fund share also increases. 
B)  If a fund receives interest or dividends from its holdings this income is passed on to share holders. 
C)  If the fund sells a security for more than it originally paid for it, the shareholders receive this in the form of capital gains. 
D)  You receive a portion of the commissions that the fund manager charges for trades. 
E)  Only A, B and C are correct.

Question 16

You purchased 100 shares of Gibraltar Strength Fund for $20.50 per share. As a result of distribution reinvestment you currently own 120 shares with a NAV of $22.75 per share. What is your total return?

Accepted Answer

A)  16.67% 
B)  20.00% 
C)  24.91% 
D)  33.17% 
A)  16.67% 
B)  20.00% 
C)  24.91% 
D)  33.17%

Question 17

An ETF provides better diversification than investing in individual company stocks.

Accepted Answer

A) True 
 B)False

Question 18

An open-end mutual fund has a fixed number of shares which are sold by the mutual fund at its inception.

Accepted Answer

A) True 
 B)False

Question 19

When you own shares in a mutual fund, you directly own shares of the companies that make up the fund.

Accepted Answer

A) True 
 B)False

Question 20

A source of third-party information like Morningstar or Yahoo! Finance is typically biased towards certain mutual fund companies.

Accepted Answer

A) True 
 B)False

Money market mutual funds

Provide a list of sources of information to evaluate mutual funds.

Which of the following services do ETF's offer?

What information can an investor find in the prospectus of a mutual fund?

What are the four choices for purchasing a mutual fund?

Life cycle funds

All mutual funds carry the same level of diversification and exposure to risk.

Bonnie and James are retired. They wish to continue to invest in their portfolio and are seeking income instead of growth. Which should they invest in?

A bond mutual fund is an appropriate choice for an investor with an income goal.

By law, all mutual funds must be broadly diversified.

A(n) ________ is a mutual fund company that has the ability to issue as many shares as investors are willing to purchase.

An equity REIT investment is limited to mortgages on income producing properties.

One of the most valuable mutual fund services available is automatic reinvestment of cash flows.

An index fund is a great choice for those who want to "beat the market."

When you own shares in a mutual fund you make money in which of the following ways?

You purchased 100 shares of Gibraltar Strength Fund for $20.50 per share. As a result of distribution reinvestment you currently own 120 shares with a NAV of $22.75 per share. What is your total return?

An ETF provides better diversification than investing in individual company stocks.

An open-end mutual fund has a fixed number of shares which are sold by the mutual fund at its inception.

When you own shares in a mutual fund, you directly own shares of the companies that make up the fund.

A source of third-party information like Morningstar or Yahoo! Finance is typically biased towards certain mutual fund companies.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Using Consumer Loans: The Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Securities Markets

Investing in Stocks

Investing in Bonds and Other Alternatives

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters

Exam 15: Mutual Funds: An Easy Way to Diversify

Money market mutual funds

Provide a list of sources of information to evaluate mutual funds.

Which of the following services do ETF's offer?

What information can an investor find in the prospectus of a mutual fund?

What are the four choices for purchasing a mutual fund?

Life cycle funds

All mutual funds carry the same level of diversification and exposure to risk.

Bonnie and James are retired. They wish to continue to invest in their portfolio and are seeking income instead of growth. Which should they invest in?

A bond mutual fund is an appropriate choice for an investor with an income goal.

By law, all mutual funds must be broadly diversified.

A(n) ________ is a mutual fund company that has the ability to issue as many shares as investors are willing to purchase.

An equity REIT investment is limited to mortgages on income producing properties.

One of the most valuable mutual fund services available is automatic reinvestment of cash flows.

An index fund is a great choice for those who want to "beat the market."

When you own shares in a mutual fund you make money in which of the following ways?

You purchased 100 shares of Gibraltar Strength Fund for $20.50 per share. As a result of distribution reinvestment you currently own 120 shares with a NAV of $22.75 per share. What is your total return?

An ETF provides better diversification than investing in individual company stocks.

An open-end mutual fund has a fixed number of shares which are sold by the mutual fund at its inception.

When you own shares in a mutual fund, you directly own shares of the companies that make up the fund.

A source of third-party information like Morningstar or Yahoo! Finance is typically biased towards certain mutual fund companies.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Using Consumer Loans: The Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investment Basics

Securities Markets

Investing in Stocks

Investing in Bonds and Other Alternatives

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters