Question 1

Short-term goals should be completed in 30 or fewer days.

Accepted Answer

A) True 
 B)False

Question 2

An unemployed single parent who just received a $300,000 divorce settlement would likely prefer conservative investments over speculative investments.

Accepted Answer

A) True 
 B)False

Question 3

If a bond is quoted in the newspaper at 90,what is its price?

Accepted Answer

A)  $9.00 
B)  $90 
C)  $900 
D)  $1,000 
E)  $1,090 
A)  $9.00 
B)  $90 
C)  $900 
D)  $1,000 
E)  $1,090

Question 4

To investors,liquidity is the ability to buy or sell an investment quickly without substantially affecting the investment's value.

Accepted Answer

A) True 
 B)False

Question 5

All of the following can be factors that influence business failure risk except

Accepted Answer

A)  Bad management. 
B)  Unsuccessful products. 
C)  Competition. 
D)  All of these can affect business failure risk. 
E)  None of these can affect business failure risk. 
A)  Bad management. 
B)  Unsuccessful products. 
C)  Competition. 
D)  All of these can affect business failure risk. 
E)  None of these can affect business failure risk.

Question 6

If a bond is quoted at a price of 108,what is its current price?

Accepted Answer

Current price = Bond

Question 7

A 25-year-old single investor with a secure,full-time job that pays $60,000 would likely prefer conservative investments over speculative investments.

Accepted Answer

A) True 
 B)False

Question 8

Younger investors tend to invest in more growth-oriented investments because they are more concerned about safety than older investors.

Accepted Answer

A) True 
 B)False

Question 9

If your primary investment objective is to receive investment income,which of the following would NOT be appropriate for your portfolio?

Accepted Answer

A)  Passbook savings account 
B)  Certificate of deposit 
C)  Municipal bond 
D)  Preferred stock 
E)  "Growth" common stock 
A)  Passbook savings account 
B)  Certificate of deposit 
C)  Municipal bond 
D)  Preferred stock 
E)  "Growth" common stock

Question 10

The usual face value of a corporate bond is $100.

Accepted Answer

A) True 
 B)False

Question 11

Assume that you purchase a $1,000 bond issued by Kohls that pays 8% interest each year,paid semiannually.What is the amount of each interest payment?

Accepted Answer

A)  $4.00 
B)  $8.00 
C)  $40.00 
D)  $80.00 
E)  $1,000 
A)  $4.00 
B)  $8.00 
C)  $40.00 
D)  $80.00 
E)  $1,000

Question 12

A bond backed by the full faith,credit,and unlimited taxing power of the government that issued it is called a ____________ bond.

Accepted Answer

A)  debenture 
B)  mortgage 
C)  secured 
D)  general obligation 
E)  revenue 
A)  debenture 
B)  mortgage 
C)  secured 
D)  general obligation 
E)  revenue

Question 13

As investors approach retirement age,they are often more interested in ______ portfolios.

Accepted Answer

A)  aggressive 
B)  international 
C)  cash 
D)  conservative 
E)  growth-oriented 
A)  aggressive 
B)  international 
C)  cash 
D)  conservative 
E)  growth-oriented

Question 14

All of the following statements are considered to be good advice for a potential investor before starting an personal investment program except

Accepted Answer

A)  Work to balance your budget. 
B)  Increase credit purchases and make installment payments in order to increase cash available for investing. 
C)  Manage your credit card debt. 
D)  Start an emergency fund. 
E)  Establish a line of credit for emergency needs. 
A)  Work to balance your budget. 
B)  Increase credit purchases and make installment payments in order to increase cash available for investing. 
C)  Manage your credit card debt. 
D)  Start an emergency fund. 
E)  Establish a line of credit for emergency needs.

Question 15

Contrast a safe investment with a speculative investment.Include at least one example of each.

Accepted Answer

A safe investment is one that has a very

Question 16

If you invest $4,000 per year over the next 40 years for retirement,which of the following is correct?

Accepted Answer

A)  A low rate of return will give you the highest total dollar return. 
B)  A high rate of return will give you the highest total dollar return. 
C)  The rate of return doesn't matter; your total dollar return will be the same with any investment. 
D)  We cannot compare the total dollar return for a low rate of return or a high rate of return. 
E)  Your investment will be worth $160,000 at retirement. 
A)  A low rate of return will give you the highest total dollar return. 
B)  A high rate of return will give you the highest total dollar return. 
C)  The rate of return doesn't matter; your total dollar return will be the same with any investment. 
D)  We cannot compare the total dollar return for a low rate of return or a high rate of return. 
E)  Your investment will be worth $160,000 at retirement.

Question 17

Fluctuations in market prices of stocks or bonds relate only to fundamental changes in the financial health of corporations.

Accepted Answer

A) True 
 B)False

Question 18

When monitoring the value of your stock investments,it is important to

Accepted Answer

A)  Wait until you sell them to determine their value. 
B)  Track the prices in the December copy of a financial magazine. 
C)  Estimate their values based on similar stocks. 
D)  Determine their values using the Internet or newspapers. 
E)  Assume that the values remain the same as long as you hold them. 
A)  Wait until you sell them to determine their value. 
B)  Track the prices in the December copy of a financial magazine. 
C)  Estimate their values based on similar stocks. 
D)  Determine their values using the Internet or newspapers. 
E)  Assume that the values remain the same as long as you hold them.

Question 19

If your main focus is to be able to buy or sell an investment quickly without substantially affecting the investment's value,you are most concerned with

Accepted Answer

A)  Income. 
B)  Growth. 
C)  Liquidity. 
D)  Business failure risk. 
E)  Market risk. 
A)  Income. 
B)  Growth. 
C)  Liquidity. 
D)  Business failure risk. 
E)  Market risk.

Question 20

Cliff Clarkson is interested in buying a bond that pays $70 annually.The current quote is 90.What is his current yield?

Accepted Answer

Current price = Quote × Face v

Short-term goals should be completed in 30 or fewer days.

An unemployed single parent who just received a $300,000 divorce settlement would likely prefer conservative investments over speculative investments.

If a bond is quoted in the newspaper at 90,what is its price?

To investors,liquidity is the ability to buy or sell an investment quickly without substantially affecting the investment's value.

All of the following can be factors that influence business failure risk except

If a bond is quoted at a price of 108,what is its current price?

A 25-year-old single investor with a secure,full-time job that pays $60,000 would likely prefer conservative investments over speculative investments.

Younger investors tend to invest in more growth-oriented investments because they are more concerned about safety than older investors.

If your primary investment objective is to receive investment income,which of the following would NOT be appropriate for your portfolio?

The usual face value of a corporate bond is $100.

Assume that you purchase a $1,000 bond issued by Kohls that pays 8% interest each year,paid semiannually.What is the amount of each interest payment?

A bond backed by the full faith,credit,and unlimited taxing power of the government that issued it is called a ____________ bond.

As investors approach retirement age,they are often more interested in ______ portfolios.

All of the following statements are considered to be good advice for a potential investor before starting an personal investment program except

Contrast a safe investment with a speculative investment.Include at least one example of each.

If you invest $4,000 per year over the next 40 years for retirement,which of the following is correct?

Fluctuations in market prices of stocks or bonds relate only to fundamental changes in the financial health of corporations.

When monitoring the value of your stock investments,it is important to

If your main focus is to be able to buy or sell an investment quickly without substantially affecting the investment's value,you are most concerned with

Cliff Clarkson is interested in buying a bond that pays $70 annually.The current quote is 90.What is his current yield?

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Savings Plans and Payment Account

Consumer Credit: Advantages, Dis-Advantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Income Insurance

Financial Planning With Life Insurance

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

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Exam 11: Investing Basics and Evaluating Bonds

Short-term goals should be completed in 30 or fewer days.

An unemployed single parent who just received a $300,000 divorce settlement would likely prefer conservative investments over speculative investments.

If a bond is quoted in the newspaper at 90,what is its price?

To investors,liquidity is the ability to buy or sell an investment quickly without substantially affecting the investment's value.

All of the following can be factors that influence business failure risk except

If a bond is quoted at a price of 108,what is its current price?

A 25-year-old single investor with a secure,full-time job that pays $60,000 would likely prefer conservative investments over speculative investments.

Younger investors tend to invest in more growth-oriented investments because they are more concerned about safety than older investors.

If your primary investment objective is to receive investment income,which of the following would NOT be appropriate for your portfolio?

The usual face value of a corporate bond is $100.

Assume that you purchase a $1,000 bond issued by Kohls that pays 8% interest each year,paid semiannually.What is the amount of each interest payment?

A bond backed by the full faith,credit,and unlimited taxing power of the government that issued it is called a ____________ bond.

As investors approach retirement age,they are often more interested in ______ portfolios.

All of the following statements are considered to be good advice for a potential investor before starting an personal investment program except

Contrast a safe investment with a speculative investment.Include at least one example of each.

If you invest $4,000 per year over the next 40 years for retirement,which of the following is correct?

Fluctuations in market prices of stocks or bonds relate only to fundamental changes in the financial health of corporations.

When monitoring the value of your stock investments,it is important to

If your main focus is to be able to buy or sell an investment quickly without substantially affecting the investment's value,you are most concerned with

Cliff Clarkson is interested in buying a bond that pays $70 annually.The current quote is 90.What is his current yield?

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Savings Plans and Payment Account

Consumer Credit: Advantages, Dis-Advantages, Sources, and Costs

Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

Selecting and Financing Housing

Home and Automobile Insurance

Health and Disability Income Insurance

Financial Planning With Life Insurance

Investing in Stocks

Investing in Mutual Funds

Starting Early: Retirement and Estate Planning

Filters