Question 1

A ________ is an organization of individuals formed to provide an institutional setting where stocks can be bought and sold.

Accepted Answer

A)  credit union 
B)  commodity exchange 
C)  stock exchange 
D)  bank 
E)  market 
A)  credit union 
B)  commodity exchange 
C)  stock exchange 
D)  bank 
E)  market C

Question 2

Barry holds a ________ for which no specific property is pledged as collateral.

Accepted Answer

A)  secured bond 
B)  bearer bond 
C)  callable bond 
D)  debenture 
E)  registered bond 
A)  secured bond 
B)  bearer bond 
C)  callable bond 
D)  debenture 
E)  registered bond D

Question 3

Mutual funds vary according to the investment goals emphasized by the fund managers.

Accepted Answer

A) True 
 B)False  True

Question 4

Discuss the value of common stock and preferred stock to shareholders and describe the secondary market for each type of security.

Accepted Answer

- common stock affords investors the pro

Question 5

Which of the following statements is correct with regard to market capitalization?

Accepted Answer

A)  There is considerable stability in the market capitalization of companies from year to year. 
B)  Market capitalization is computed by dividing owners' equity by the number of outstanding shares. 
C)  Currently,in Canada,the companies with the highest market capitalization are financial institutions or resource companies. 
D)  There is general agreement that market capitalization really doesn't tell us very much about the real value of a company. 
E)  All of these statements are correct. 
A)  There is considerable stability in the market capitalization of companies from year to year. 
B)  Market capitalization is computed by dividing owners' equity by the number of outstanding shares. 
C)  Currently,in Canada,the companies with the highest market capitalization are financial institutions or resource companies. 
D)  There is general agreement that market capitalization really doesn't tell us very much about the real value of a company. 
E)  All of these statements are correct.

Question 6

Most commodities investors have no intention of ever taking possession of the commodities in which they trade.

Accepted Answer

A) True 
 B)False

Question 7

What are stock options? Describe the two types of options available to investors.

Accepted Answer

- stock option: the purchased right to b

Question 8

Bonds differ in terms of maturity dates,tax status,level of risk,and potential yield.

Accepted Answer

A) True 
 B)False

Question 9

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document,which contains complete information on both the new issue and the corporation.What is that required document called?

Accepted Answer

A)  Prospectus 
B)  Book report 
C)  Affidavit 
D)  Income statement 
E)  Order blank 
A)  Prospectus 
B)  Book report 
C)  Affidavit 
D)  Income statement 
E)  Order blank

Question 10

________buy and sell stocks and bonds on stock exchanges for investors.

Accepted Answer

A)  Finance companies 
B)  Chartered banks 
C)  Pension services 
D)  Credit unions 
E)  Brokers 
A)  Finance companies 
B)  Chartered banks 
C)  Pension services 
D)  Credit unions 
E)  Brokers

Question 11

What is the purpose of the various provincial securities commissions? What are some of the difficulties these agencies encounter as they try to protect investors?

Accepted Answer

- three areas: 
- blue-sky laws: laws th

Question 12

________ are mostly used by financially strong corporations.

Accepted Answer

A)  Callable bonds 
B)  Bearer bonds 
C)  Registered bonds 
D)  Debentures 
E)  Secured bonds 
A)  Callable bonds 
B)  Bearer bonds 
C)  Registered bonds 
D)  Debentures 
E)  Secured bonds

Question 13

A(n)________ is a summary of price trends in a specific industry and/or the stock market as a whole.

Accepted Answer

A)  investment index 
B)  market index 
C)  average index 
D)  market indicator 
E)  average indicator 
A)  investment index 
B)  market index 
C)  average index 
D)  market indicator 
E)  average indicator

Question 14

Exchange-traded funds

Accepted Answer

A)  can only be traded by individuals who are members of a stock exchange. 
B)  can be traded only in the morning hours. 
C)  allow individual investors to exchange shares of mutual funds that they hold. 
D)  are priced only at the end of the day. 
E)  have lower operating expenses than mutual funds. 
A)  can only be traded by individuals who are members of a stock exchange. 
B)  can be traded only in the morning hours. 
C)  allow individual investors to exchange shares of mutual funds that they hold. 
D)  are priced only at the end of the day. 
E)  have lower operating expenses than mutual funds.

Question 15

A stock quote of 30.5 means

Accepted Answer

A)  the stock is down 30.5 cents per share from yesterday's price. 
B)  the stock is selling at $30.50 per share. 
C)  the stock is selling at 30.5 cents per share. 
D)  the stock is up 30.5 cents per share from yesterday's price. 
E)  the stock will be selling for 30.5 cents per share for the next 5 days. 
A)  the stock is down 30.5 cents per share from yesterday's price. 
B)  the stock is selling at $30.50 per share. 
C)  the stock is selling at 30.5 cents per share. 
D)  the stock is up 30.5 cents per share from yesterday's price. 
E)  the stock will be selling for 30.5 cents per share for the next 5 days.

Question 16

What is the difference between par value,market value,and book value?

Accepted Answer

different ways of evaluating a stock's w

Question 17

Mega Computer issued stock with a face value of one cent and then sold the shares to the public for $20.00 each.Ted bought 10 shares at that price.Today,Ted sold his shares to David for $25.00 each.What are Ted's capital gains?

Accepted Answer

A)  $19.99 
B)  $20.00 
C)  $25.00 
D)  $50.00 
E)  $0.01 
A)  $19.99 
B)  $20.00 
C)  $25.00 
D)  $50.00 
E)  $0.01

Question 18

In recent years,bond rating firms like Moody's and Standard & Poor's have been very accurate in their assessments of the risks of investing in various securities.

Accepted Answer

A) True 
 B)False

Question 19

Buying and selling existing stock is accomplished through a business firm with a seat on a stock exchange.

Accepted Answer

A) True 
 B)False

Question 20

The federal Government of Canada issues bonds (e.g.,Canada Savings Bonds),but provinces are not allowed to do so.

Accepted Answer

A) True 
 B)False

A ________ is an organization of individuals formed to provide an institutional setting where stocks can be bought and sold.

Barry holds a ________ for which no specific property is pledged as collateral.

Mutual funds vary according to the investment goals emphasized by the fund managers.

Discuss the value of common stock and preferred stock to shareholders and describe the secondary market for each type of security.

Which of the following statements is correct with regard to market capitalization?

Most commodities investors have no intention of ever taking possession of the commodities in which they trade.

What are stock options? Describe the two types of options available to investors.

Bonds differ in terms of maturity dates,tax status,level of risk,and potential yield.

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document,which contains complete information on both the new issue and the corporation.What is that required document called?

________buy and sell stocks and bonds on stock exchanges for investors.

What is the purpose of the various provincial securities commissions? What are some of the difficulties these agencies encounter as they try to protect investors?

________ are mostly used by financially strong corporations.

A(n)________ is a summary of price trends in a specific industry and/or the stock market as a whole.

Exchange-traded funds

A stock quote of 30.5 means

What is the difference between par value,market value,and book value?

Mega Computer issued stock with a face value of one cent and then sold the shares to the public for $20.00 each.Ted bought 10 shares at that price.Today,Ted sold his shares to David for $25.00 each.What are Ted's capital gains?

In recent years,bond rating firms like Moody's and Standard & Poor's have been very accurate in their assessments of the risks of investing in various securities.

Buying and selling existing stock is accomplished through a business firm with a seat on a stock exchange.

The federal Government of Canada issues bonds (e.g.,Canada Savings Bonds),but provinces are not allowed to do so.

Understanding the Canadian Business System

Understanding the Environments of Business

Conducting Business Ethically and Responsibly

Understanding Entrepreneurship, small Business, and New Venture Creation

The Global Context of Business

Managing the Business Enterprise

Managing Human Resources

Understanding Labourmanagement Relations

Motivating and Leading Employees

Producing Goods and Services

Increasing Productivity and Quality

Managing Information Systems and Communication Technology

Understanding Accounting Issues

Understanding Marketing Processes and Consumer Behaviour

Developing and Promoting Goods and Services

Pricing and Distributing Goods and Services

Understanding Money and Banking

Financial Decisions and Risk Management

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Exam 19: Understanding Securities and Investments

A ________ is an organization of individuals formed to provide an institutional setting where stocks can be bought and sold.

Barry holds a ________ for which no specific property is pledged as collateral.

Mutual funds vary according to the investment goals emphasized by the fund managers.

Discuss the value of common stock and preferred stock to shareholders and describe the secondary market for each type of security.

Which of the following statements is correct with regard to market capitalization?

Most commodities investors have no intention of ever taking possession of the commodities in which they trade.

What are stock options? Describe the two types of options available to investors.

Bonds differ in terms of maturity dates,tax status,level of risk,and potential yield.

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document,which contains complete information on both the new issue and the corporation.What is that required document called?

________buy and sell stocks and bonds on stock exchanges for investors.

What is the purpose of the various provincial securities commissions? What are some of the difficulties these agencies encounter as they try to protect investors?

________ are mostly used by financially strong corporations.

A(n)________ is a summary of price trends in a specific industry and/or the stock market as a whole.

Exchange-traded funds

A stock quote of 30.5 means

What is the difference between par value,market value,and book value?

Mega Computer issued stock with a face value of one cent and then sold the shares to the public for $20.00 each.Ted bought 10 shares at that price.Today,Ted sold his shares to David for $25.00 each.What are Ted's capital gains?

In recent years,bond rating firms like Moody's and Standard & Poor's have been very accurate in their assessments of the risks of investing in various securities.

Buying and selling existing stock is accomplished through a business firm with a seat on a stock exchange.

The federal Government of Canada issues bonds (e.g.,Canada Savings Bonds),but provinces are not allowed to do so.

Understanding the Canadian Business System

Understanding the Environments of Business

Conducting Business Ethically and Responsibly

Understanding Entrepreneurship, small Business, and New Venture Creation

The Global Context of Business

Managing the Business Enterprise

Managing Human Resources

Understanding Labourmanagement Relations

Motivating and Leading Employees

Producing Goods and Services

Increasing Productivity and Quality

Managing Information Systems and Communication Technology

Understanding Accounting Issues

Understanding Marketing Processes and Consumer Behaviour

Developing and Promoting Goods and Services

Pricing and Distributing Goods and Services

Understanding Money and Banking

Financial Decisions and Risk Management

Filters