Question 1

The significant difference between HOLDRs and ETFs is that

Accepted Answer

A) the owner of the HOLDR has rights to the underlying stock. 
B) HOLDRs are not traded in financial markets. 
C) ETFs are not traded in financial markets. 
D) owners of HOLDRs do not pay commissions on trades. 
A) the owner of the HOLDR has rights to the underlying stock. 
B) HOLDRs are not traded in financial markets. 
C) ETFs are not traded in financial markets. 
D) owners of HOLDRs do not pay commissions on trades.

Question 2

A mutual fund's reinvestment plan allows you to buy additional shares in a fund from the fund's dividends.

Accepted Answer

A) True 
 B)False

Question 3

Consider the following assets: I.Treasury Strips,II.Coupon Treasury bonds,III.growth stocks,and IV.medium quality corporate bonds.A cautious investor with high-priority future goals,but who does not need current income,would prefer

Accepted Answer

A) I. 
B) II. 
C) III. 
D) IV. 
A) I. 
B) II. 
C) III. 
D) IV.

Question 4

A risk-adjusted rate of return for a mutual fund uses the fund's beta weight.

Accepted Answer

A) True 
 B)False

Question 5

Shares of an open-end fund are typically purchased through stockbrokers,while closed-end fund shares are typically purchased directly from the fund.

Accepted Answer

A) True 
 B)False

Question 6

A mortgage REIT invests only in real estate that is mortgaged.

Accepted Answer

A) True 
 B)False

Question 7

ETFs track specific market indexes.

Accepted Answer

A) True 
 B)False

Question 8

A REIT's equity per share is

Accepted Answer

A) its market value per share. 
B) the amount it has invested in property per share. 
C) the initial amount of money per share invested in it. 
D) a value measurement similar to the NAV of a mutual fund. 
A) its market value per share. 
B) the amount it has invested in property per share. 
C) the initial amount of money per share invested in it. 
D) a value measurement similar to the NAV of a mutual fund.

Question 9

A variable ratio plan adjusts a portfolio by

Accepted Answer

A) holding asset weights constant. 
B) increasing or decreasing all asset weights in response to income changes. 
C) increasing the weight of assets that have performed well in the recent past. 
D) increasing the weight of assets that have performed poorly in the recent past. 
A) holding asset weights constant. 
B) increasing or decreasing all asset weights in response to income changes. 
C) increasing the weight of assets that have performed well in the recent past. 
D) increasing the weight of assets that have performed poorly in the recent past.

Question 10

A fund's reinvestment plan allows investors to

Accepted Answer

A) make periodic deposits to the fund from their checking accounts. 
B) make regular withdrawals from the fund. 
C) reinvest all dividends and/or capital gains into the fund's shares. 
D) reinvest profits from one fund into shares of another fund. 
A) make periodic deposits to the fund from their checking accounts. 
B) make regular withdrawals from the fund. 
C) reinvest all dividends and/or capital gains into the fund's shares. 
D) reinvest profits from one fund into shares of another fund.

Question 11

The best strategy for selecting mutual funds in the 401(k)plan is to

Accepted Answer

A) pick an index fund. 
B) pick an aggressive growth fund,using last year's performance as a guide. 
C) select a number of funds to achieve broad diversification. 
D) pick a money market fund to avoid risk. 
A) pick an index fund. 
B) pick an aggressive growth fund,using last year's performance as a guide. 
C) select a number of funds to achieve broad diversification. 
D) pick a money market fund to avoid risk.

Question 12

One advantage of a limited partnership in comparison to a general partnership is that you cannot lose more than you invest.

Accepted Answer

A) True 
 B)False

Question 13

Which item below is not a characteristic of investment clubs?

Accepted Answer

A) Small monthly dues,in the $25 range 
B) Reinvestment of dividends and capital gains 
C) Reliance upon stockbrokers for research and advice 
D) An opportunity for diversification 
A) Small monthly dues,in the $25 range 
B) Reinvestment of dividends and capital gains 
C) Reliance upon stockbrokers for research and advice 
D) An opportunity for diversification

Question 14

If you are comparing fund expenses for two funds with different objectives,it is better to reference the expenses against each fund's earnings rather than its assets.

Accepted Answer

A) True 
 B)False

Question 15

If you follow a variable ratio plan,it is assumed that you

Accepted Answer

A) cannot forecast future asset values. 
B) are engaging in a form of market timing. 
C) are planning for your future retirement. 
D) are trying to offset capital gains with capital losses. 
A) cannot forecast future asset values. 
B) are engaging in a form of market timing. 
C) are planning for your future retirement. 
D) are trying to offset capital gains with capital losses.

Question 16

"Fund switching" allows investors to switch in and out of IRAs.

Accepted Answer

A) True 
 B)False

Question 17

A mutual fund is an organization that

Accepted Answer

A) invests its funds in securities issued by corporations and governments. 
B) is part of an insurance company that invests policyholders' premiums. 
C) a partnership of corporate investors. 
D) sets money aside to absorb potential stock market losses. 
A) invests its funds in securities issued by corporations and governments. 
B) is part of an insurance company that invests policyholders' premiums. 
C) a partnership of corporate investors. 
D) sets money aside to absorb potential stock market losses.

Question 18

Which item below is usually not a characteristic of a limited partnership?

Accepted Answer

A) They have limited investment appeal. 
B) Loss-limitation rules of the tax code do not apply to them. 
C) Partnership interests may be difficult to sell. 
D) They have poor liquidity. 
A) They have limited investment appeal. 
B) Loss-limitation rules of the tax code do not apply to them. 
C) Partnership interests may be difficult to sell. 
D) They have poor liquidity.

Question 19

An advantage of trading exchange-traded funds is that you can do so without incurring commission costs.

Accepted Answer

A) True 
 B)False

Question 20

The 1986 Tax Reform Act

Accepted Answer

A) increased the appeal of real estate limited partnerships. 
B) required that all limited partnerships become public syndicates. 
C) eliminated many tax advantages previously associated with limited partnerships. 
D) made real estate limited partnerships illegal. 
A) increased the appeal of real estate limited partnerships. 
B) required that all limited partnerships become public syndicates. 
C) eliminated many tax advantages previously associated with limited partnerships. 
D) made real estate limited partnerships illegal.

The significant difference between HOLDRs and ETFs is that

A mutual fund's reinvestment plan allows you to buy additional shares in a fund from the fund's dividends.

Consider the following assets: I.Treasury Strips,II.Coupon Treasury bonds,III.growth stocks,and IV.medium quality corporate bonds.A cautious investor with high-priority future goals,but who does not need current income,would prefer

A risk-adjusted rate of return for a mutual fund uses the fund's beta weight.

Shares of an open-end fund are typically purchased through stockbrokers,while closed-end fund shares are typically purchased directly from the fund.

A mortgage REIT invests only in real estate that is mortgaged.

ETFs track specific market indexes.

A REIT's equity per share is

A variable ratio plan adjusts a portfolio by

A fund's reinvestment plan allows investors to

The best strategy for selecting mutual funds in the 401(k)plan is to

One advantage of a limited partnership in comparison to a general partnership is that you cannot lose more than you invest.

Which item below is not a characteristic of investment clubs?

If you are comparing fund expenses for two funds with different objectives,it is better to reference the expenses against each fund's earnings rather than its assets.

If you follow a variable ratio plan,it is assumed that you

"Fund switching" allows investors to switch in and out of IRAs.

A mutual fund is an organization that

Which item below is usually not a characteristic of a limited partnership?

An advantage of trading exchange-traded funds is that you can do so without incurring commission costs.

The 1986 Tax Reform Act

Financial Planning: Why Its Important to You

The Time Value of Money: All Dollars Are Not Created Equal

Financial Statement and Budgets: Where Are You Now and Where Are You Going

Taxes: the Governments Share of Your Rewards

Liquidity Management: Managing Current Assets and Current Liabilities

Short-Term Credit Management: Consumer Credit

Consumer Durables: the Personal Auto

Housing: the Cost of Shelter

Financial Markets and Instruments: Learning the Investment Environment

Investment Basics: Understanding Risk and Return

Stocks and Bonds: Your Most Common Investments

Property and Liability Insurance: Protecting Your Lifestyle Assets

Health Care and Disability Insurance: Protecting Your Earning Capacity

Life Insurance and Estate Planning: Protecting Your Dependents

Retirement Planning: Planning for Your Long-Term Needs

Filters

Exam 12: Mutual Fundsother Pooling Arrangements: Simplifying, Maybe Improving Investment Performance

The significant difference between HOLDRs and ETFs is that

A mutual fund's reinvestment plan allows you to buy additional shares in a fund from the fund's dividends.

Consider the following assets: I.Treasury Strips,II.Coupon Treasury bonds,III.growth stocks,and IV.medium quality corporate bonds.A cautious investor with high-priority future goals,but who does not need current income,would prefer

A risk-adjusted rate of return for a mutual fund uses the fund's beta weight.

Shares of an open-end fund are typically purchased through stockbrokers,while closed-end fund shares are typically purchased directly from the fund.

A mortgage REIT invests only in real estate that is mortgaged.

ETFs track specific market indexes.

A REIT's equity per share is

A variable ratio plan adjusts a portfolio by

A fund's reinvestment plan allows investors to

The best strategy for selecting mutual funds in the 401(k)plan is to

One advantage of a limited partnership in comparison to a general partnership is that you cannot lose more than you invest.

Which item below is not a characteristic of investment clubs?

If you are comparing fund expenses for two funds with different objectives,it is better to reference the expenses against each fund's earnings rather than its assets.

If you follow a variable ratio plan,it is assumed that you

"Fund switching" allows investors to switch in and out of IRAs.

A mutual fund is an organization that

Which item below is usually not a characteristic of a limited partnership?

An advantage of trading exchange-traded funds is that you can do so without incurring commission costs.

The 1986 Tax Reform Act

Financial Planning: Why Its Important to You

The Time Value of Money: All Dollars Are Not Created Equal

Financial Statement and Budgets: Where Are You Now and Where Are You Going

Taxes: the Governments Share of Your Rewards

Liquidity Management: Managing Current Assets and Current Liabilities

Short-Term Credit Management: Consumer Credit

Consumer Durables: the Personal Auto

Housing: the Cost of Shelter

Financial Markets and Instruments: Learning the Investment Environment

Investment Basics: Understanding Risk and Return

Stocks and Bonds: Your Most Common Investments

Property and Liability Insurance: Protecting Your Lifestyle Assets

Health Care and Disability Insurance: Protecting Your Earning Capacity

Life Insurance and Estate Planning: Protecting Your Dependents

Retirement Planning: Planning for Your Long-Term Needs

Filters