Question 1

The potential return of any investment should be directly related to the risk that the investor assumes.

Accepted Answer

A) True 
 B)False

Question 2

The fees for investor services and newsletters generally range from ____________ a year.

Accepted Answer

A)  $10 to $20, or free 
B)  $20 to $30, or free 
C)  $30 to $750, or free 
D)  $300 to $1,000, or free 
E)  over $1,,000, or free 
A)  $10 to $20, or free 
B)  $20 to $30, or free 
C)  $30 to $750, or free 
D)  $300 to $1,000, or free 
E)  over $1,,000, or free

Question 3

A short-term investment objective is defined as one that will be accomplished within a period of less than two years.

Accepted Answer

A) True 
 B)False

Question 4

Mutual funds range from very conservative to extremely speculative investments.

Accepted Answer

A) True 
 B)False

Question 5

Derivatives are securities such as options, and forward and futures contracts, whose value depends on the performance of an underlying security.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following is not a determinant of investor risk tolerance?

Accepted Answer

A)  goals and time frames 
B)  economy 
C)  income and asset base 
D)  personality 
E)  income 
A)  goals and time frames 
B)  economy 
C)  income and asset base 
D)  personality 
E)  income

Question 7

After graduating from university, you obtain a job as a medical records technician. Your monthly salary is $2,000. Your monthly expenses are $1,600. Based on this information, what steps should you take to establish a long-term investment program?

Accepted Answer

The following steps for establishing an

Question 8

Diversification of assets among several types of investments can increase risk.

Accepted Answer

A) True 
 B)False

Question 9

A corporation selling stock is obligated to

Accepted Answer

A)  guarantee your investment. 
B)  repay money obtained from the sale of stock. 
C)  repurchase shares of stock at a later date. 
D)  pay dividends to preferred stockholders before dividends are paid to common stockholders. 
E)  pay dividends. 
A)  guarantee your investment. 
B)  repay money obtained from the sale of stock. 
C)  repurchase shares of stock at a later date. 
D)  pay dividends to preferred stockholders before dividends are paid to common stockholders. 
E)  pay dividends.

Question 10

Generally, options are not long-term investment techniques.

Accepted Answer

A) True 
 B)False

Question 11

If interest rates in the overall economy increase, what will happen to the market value of a corporate bond with a fixed interest rate?

Accepted Answer

A)  The value of the bond will increase. 
B)  The bond is worthless. 
C)  The value of the bond will decrease. 
D)  The value of the bond will not change. 
E)  It is impossible to determine if the bond's value will increase or decrease. 
A)  The value of the bond will increase. 
B)  The bond is worthless. 
C)  The value of the bond will decrease. 
D)  The value of the bond will not change. 
E)  It is impossible to determine if the bond's value will increase or decrease.

Question 12

Your investment suddenly goes down 15 percent one month after you invest. Its fundamentals still look good. What would you do if you were a very risk tolerant investor?

Accepted Answer

A)  Hold on and wait for it to come back. 
B)  Buy more. If it looked good at the original price, it looks even better now 
C)  Sell it to avoid losing even more 
D)  Sell and then buy if it goes down again 
E)  sell and buy GICs 
A)  Hold on and wait for it to come back. 
B)  Buy more. If it looked good at the original price, it looks even better now 
C)  Sell it to avoid losing even more 
D)  Sell and then buy if it goes down again 
E)  sell and buy GICs

Question 13

A long-term objective may take up to three years to accomplish.

Accepted Answer

A) True 
 B)False

Question 14

Define what an emergency fund is and describe its function. If your income is $20,000 per year and living expenses are $1,500/month, how much money should be in the fund?

Accepted Answer

An emergency fund is an amount of money

Question 15

A decrease in the value of stocks, bonds, or other investments may cause investors to experience ____________ risk.

Accepted Answer

A)  market 
B)  interest rate 
C)  business failure 
D)  inflation 
E)  income 
A)  market 
B)  interest rate 
C)  business failure 
D)  inflation 
E)  income

Question 16

A designated financial planner has had at least two years of training in securities, insurance, taxes, real estate, and estate planning and has passed a rigorous examination.

Accepted Answer

A) True 
 B)False

Question 17

When investing in global investments, changes in the currency exchange rate may affect the return on your investment.

Accepted Answer

A) True 
 B)False

Question 18

A long-term objective may take more than five years to accomplish.

Accepted Answer

A) True 
 B)False

Question 19

An emergency fund should be deposited in a

Accepted Answer

A)  savings account at the highest available interest rate. 
B)  six-month certificate of deposit. 
C)  checking account. 
D)  safe place at home. 
E)  safe deposit box in a bank vault. 
A)  savings account at the highest available interest rate. 
B)  six-month certificate of deposit. 
C)  checking account. 
D)  safe place at home. 
E)  safe deposit box in a bank vault.

Question 20

An intermediate-term objective is defined as one that will be accomplished within eighteen months.

Accepted Answer

A) True 
 B)False

The potential return of any investment should be directly related to the risk that the investor assumes.

The fees for investor services and newsletters generally range from ____________ a year.

A short-term investment objective is defined as one that will be accomplished within a period of less than two years.

Mutual funds range from very conservative to extremely speculative investments.

Derivatives are securities such as options, and forward and futures contracts, whose value depends on the performance of an underlying security.

Which of the following is not a determinant of investor risk tolerance?

After graduating from university, you obtain a job as a medical records technician. Your monthly salary is $2,000. Your monthly expenses are $1,600. Based on this information, what steps should you take to establish a long-term investment program?

Diversification of assets among several types of investments can increase risk.

A corporation selling stock is obligated to

Generally, options are not long-term investment techniques.

If interest rates in the overall economy increase, what will happen to the market value of a corporate bond with a fixed interest rate?

Your investment suddenly goes down 15 percent one month after you invest. Its fundamentals still look good. What would you do if you were a very risk tolerant investor?

A long-term objective may take up to three years to accomplish.

Define what an emergency fund is and describe its function. If your income is $20,000 per year and living expenses are $1,500/month, how much money should be in the fund?

A decrease in the value of stocks, bonds, or other investments may cause investors to experience ____________ risk.

A designated financial planner has had at least two years of training in securities, insurance, taxes, real estate, and estate planning and has passed a rigorous examination.

When investing in global investments, changes in the currency exchange rate may affect the return on your investment.

A long-term objective may take more than five years to accomplish.

An emergency fund should be deposited in a

An intermediate-term objective is defined as one that will be accomplished within eighteen months.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters

Exam 10: Fundamentals of Investing

The potential return of any investment should be directly related to the risk that the investor assumes.

The fees for investor services and newsletters generally range from ____________ a year.

A short-term investment objective is defined as one that will be accomplished within a period of less than two years.

Mutual funds range from very conservative to extremely speculative investments.

Derivatives are securities such as options, and forward and futures contracts, whose value depends on the performance of an underlying security.

Which of the following is not a determinant of investor risk tolerance?

After graduating from university, you obtain a job as a medical records technician. Your monthly salary is $2,000. Your monthly expenses are $1,600. Based on this information, what steps should you take to establish a long-term investment program?

Diversification of assets among several types of investments can increase risk.

A corporation selling stock is obligated to

Generally, options are not long-term investment techniques.

If interest rates in the overall economy increase, what will happen to the market value of a corporate bond with a fixed interest rate?

Your investment suddenly goes down 15 percent one month after you invest. Its fundamentals still look good. What would you do if you were a very risk tolerant investor?

A long-term objective may take up to three years to accomplish.

Define what an emergency fund is and describe its function. If your income is $20,000 per year and living expenses are $1,500/month, how much money should be in the fund?

A decrease in the value of stocks, bonds, or other investments may cause investors to experience ____________ risk.

A designated financial planner has had at least two years of training in securities, insurance, taxes, real estate, and estate planning and has passed a rigorous examination.

When investing in global investments, changes in the currency exchange rate may affect the return on your investment.

A long-term objective may take more than five years to accomplish.

An emergency fund should be deposited in a

An intermediate-term objective is defined as one that will be accomplished within eighteen months.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters