Question 1

Which of the following statements is not true?

Accepted Answer

A)  When buying stock on margin,an investor borrows part of the money necessary to buy a particular stock. 
B)  Usually,the brokerage firm lends the money or arranges for the loan in a margin transaction. 
C)  Investors buy on margin because doing so offers them the potential for greater profits. 
D)  The margin requirement is set by the exchanges. 
E)  The current margin requirement is identical for all exchanges. 
A)  When buying stock on margin,an investor borrows part of the money necessary to buy a particular stock. 
B)  Usually,the brokerage firm lends the money or arranges for the loan in a margin transaction. 
C)  Investors buy on margin because doing so offers them the potential for greater profits. 
D)  The margin requirement is set by the exchanges. 
E)  The current margin requirement is identical for all exchanges.

Question 2

If the board of directors approves a two for one stock split,an investor who owns 200 shares before the split owns ____________ shares after the split.

Accepted Answer

A)  75 
B)  200 
C)  225 
D)  400 
E)  450 
A)  75 
B)  200 
C)  225 
D)  400 
E)  450

Question 3

Devin Scott is looking for an investment that will provide a predictable source of income.With this goal in mind,which of the following industry groups would normally be classified as an industry to invest in for income?

Accepted Answer

A)  public utilities 
B)  electronics 
C)  automobile manufacturing 
D)  steel manufacturing 
E)  paper manufacturing 
A)  public utilities 
B)  electronics 
C)  automobile manufacturing 
D)  steel manufacturing 
E)  paper manufacturing

Question 4

Ammar purchased 100 shares of Northern Bank at $55 dollars a share in January of 2004.The shares subsequently split two-for-one on December 31,2004 after paying an annual dividend of $1.00 per share.If Ammar sells all of his shares on the first trading day in January 2005 for $30 each,what has been his return on investment?

Accepted Answer

A)  Zero 
B)  9.1% 
C)  10.0% 
D)  10.9% 
E)  15% 
A)  Zero 
B)  9.1% 
C)  10.0% 
D)  10.9% 
E)  15%

Question 5

The minimum commission charged by most brokerage firms for buying or selling stock is between $50 and $75.

Accepted Answer

A) True 
 B)False

Question 6

The Cumulative feature of a preferred stock is that a corporation may exchange,at its option,for a specified amount of money.

Accepted Answer

A) True 
 B)False

Question 7

An order to buy or sell a security that lets the broker decide when to execute the transaction and at what price is called a ____________ order.

Accepted Answer

A)  market 
B)  limit 
C)  stop 
D)  round 
E)  discretionary 
A)  market 
B)  limit 
C)  stop 
D)  round 
E)  discretionary

Question 8

What is the primary difference between common stock and preferred stock?

Accepted Answer

The most important priority that an inve

Question 9

Dividends remain with the stock until

Accepted Answer

A)  five days after the date of record. 
B)  two business days after the date of record. 
C)  five days before the date of record. 
D)  two business days before the date of record. 
E)  five days before the actual payment date. 
A)  five days after the date of record. 
B)  two business days after the date of record. 
C)  five days before the date of record. 
D)  two business days before the date of record. 
E)  five days before the actual payment date.

Question 10

Which one of the following is not a true statement?

Accepted Answer

A)  The over-the-counter market is a network of dealers who buy and sell the securities of corporations that are not listed on a securities exchange. 
B)  Account executives in the OTC market specialize or make a market in the securities of one or more specific firms. 
C)  Most OTC trading is conducted in person in the account executive's office. 
D)  Since 1971,account executives' operating in the OTC market have used an electronic quotation system called NASDAQ. 
E)  NASDAQ is regulated by the National Association of Securities Dealers. 
A)  The over-the-counter market is a network of dealers who buy and sell the securities of corporations that are not listed on a securities exchange. 
B)  Account executives in the OTC market specialize or make a market in the securities of one or more specific firms. 
C)  Most OTC trading is conducted in person in the account executive's office. 
D)  Since 1971,account executives' operating in the OTC market have used an electronic quotation system called NASDAQ. 
E)  NASDAQ is regulated by the National Association of Securities Dealers.

Question 11

A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called a

Accepted Answer

A)  dollar cost averaging. 
B)  dividend reinvestment plan. 
C)  buy and hold technique. 
D)  regulated transaction. 
E)  secured transaction. 
A)  dollar cost averaging. 
B)  dividend reinvestment plan. 
C)  buy and hold technique. 
D)  regulated transaction. 
E)  secured transaction.

Which of the following statements is not true?

If the board of directors approves a two for one stock split,an investor who owns 200 shares before the split owns ____________ shares after the split.

Devin Scott is looking for an investment that will provide a predictable source of income.With this goal in mind,which of the following industry groups would normally be classified as an industry to invest in for income?

The minimum commission charged by most brokerage firms for buying or selling stock is between $50 and $75.

The Cumulative feature of a preferred stock is that a corporation may exchange,at its option,for a specified amount of money.

An order to buy or sell a security that lets the broker decide when to execute the transaction and at what price is called a ____________ order.

What is the primary difference between common stock and preferred stock?

Dividends remain with the stock until

Which one of the following is not a true statement?

A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called a

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Consumer Purchasing Strategies and Wise Buying of Motor Vehicles

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Exam 11: Investing Basics and Evaluating Bonds

Which of the following statements is not true?

If the board of directors approves a two for one stock split,an investor who owns 200 shares before the split owns ____________ shares after the split.

Devin Scott is looking for an investment that will provide a predictable source of income.With this goal in mind,which of the following industry groups would normally be classified as an industry to invest in for income?

The minimum commission charged by most brokerage firms for buying or selling stock is between $50 and $75.

The Cumulative feature of a preferred stock is that a corporation may exchange,at its option,for a specified amount of money.

An order to buy or sell a security that lets the broker decide when to execute the transaction and at what price is called a ____________ order.

What is the primary difference between common stock and preferred stock?

Dividends remain with the stock until

Which one of the following is not a true statement?

A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called a

Personal Financial Planning in Action

Money Management Skills

Taxes in Your Financial Plan

Financial Services: Savings Plans and Payment Accounts

Consumer Credit: Advantages, Disadvantages, 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

Daily Spending Diary

Filters