Question 1

Charting is the technique of

Accepted Answer

A)  plotting the performance of a security over time. 
B)  sorting through databases of securities to select one based on certain parameters. 
C)  monitoring a stock based on the underlying economic conditions. 
D)  determining the amount of money that must be saved based on a given financial goal. 
A)  plotting the performance of a security over time. 
B)  sorting through databases of securities to select one based on certain parameters. 
C)  monitoring a stock based on the underlying economic conditions. 
D)  determining the amount of money that must be saved based on a given financial goal.

Question 2

Most brokers charge higher commissions for on-line trades than for telephone transactions.

Accepted Answer

A) True 
 B)False

Question 3

Ryan places a good-'til-canceled limit order to sell 300 shares of KM at $18 a share. When his order reaches the trading floor, KM is trading at $18.20. Which of the following statements is true concerning Roy's order?

Accepted Answer

A)  The trade will not be executed and will be immediately cancelled. 
B)  The specialist will record the order in the order book and execute the trade as soon as the price hits $18.00. 
C)  The brokerage firm will sell the 300 shares at $18.20 and keep the additional $0.20 as a commission. 
D)  The order will be executed at $18.20 with the proceeds credited to Roy's account. 
A)  The trade will not be executed and will be immediately cancelled. 
B)  The specialist will record the order in the order book and execute the trade as soon as the price hits $18.00. 
C)  The brokerage firm will sell the 300 shares at $18.20 and keep the additional $0.20 as a commission. 
D)  The order will be executed at $18.20 with the proceeds credited to Roy's account.

Question 4

Earnings on securities held in street name by the brokerage are not reported to the Internal Revenue Service.

Accepted Answer

A) True 
 B)False

Question 5

Market orders are usually executed

Accepted Answer

A)  only after all limit orders have been executed. 
B)  at the average price during the previous trading session. 
C)  at the closing price for the day's trading. 
D)  before the price can change significantly if the order is placed while the markets are in session. 
A)  only after all limit orders have been executed. 
B)  at the average price during the previous trading session. 
C)  at the closing price for the day's trading. 
D)  before the price can change significantly if the order is placed while the markets are in session.

Question 6

Recent studies suggest that, on average, investments clubs

Accepted Answer

A)  outperform broad market indexes by several percentage points. 
B)  underperform broad market indexes by a several percentage points. 
C)  earn average rates of return. 
D)  no data is available on investment club performance. 
A)  outperform broad market indexes by several percentage points. 
B)  underperform broad market indexes by a several percentage points. 
C)  earn average rates of return. 
D)  no data is available on investment club performance.

Question 7

Descriptive information might include the company's lines of business, a list of major competitors, and recent changes in management.

Accepted Answer

A) True 
 B)False

Question 8

Both the Dow Jones Industrial Average and the Standard & Poor's 500 Index are constructed to reflect the value of shares in large, mid-size and smaller companies.

Accepted Answer

A) True 
 B)False

Question 9

Small investors normally have a negotiated commission schedule while large investors benefit from a fixed-commission schedule.

Accepted Answer

A) True 
 B)False

Question 10

A stop-loss order is activated once the stock reaches the specified price.

Accepted Answer

A) True 
 B)False

Question 11

Heather places an order to buy 525 shares of stock. This is an order for

Accepted Answer

A)  five round lots and one odd lot. 
B)  21 round lots of 25. 
C)  one odd lot. 
D)  five hundred round lots and twenty-five odd lots. 
A)  five round lots and one odd lot. 
B)  21 round lots of 25. 
C)  one odd lot. 
D)  five hundred round lots and twenty-five odd lots.

Question 12

Which is the correct order of events when an individual buys a stock through a brokerage firm?
I. The order is transmitted to the main office of the brokerage firm.
II. The customer places the order with their local stockbroker.
III. The confirmation of the order is sent to the broker placing the order.
IV. The order is sent to the floor of the exchange.

Accepted Answer

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

Question 13

The Value Line Investment Survey includes which of the following reports?
I. Selection and Opinion
II. The Outlook
III. Ratings and Reports
IV. Summary and Index

Accepted Answer

A)  I and II only 
B)  I, II and IV only 
C)  I, III and IV only 
D)  II, III and IV only 
A)  I and II only 
B)  I, II and IV only 
C)  I, III and IV only 
D)  II, III and IV only

Question 14

Traders who hold stocks for less than a full day can reduce the tax burden on their profits.

Accepted Answer

A) True 
 B)False

Question 15

Which one of the following web sites should you utilize to review the financial information in a company's 10-K report?

Accepted Answer

A)  freeedgar.com 
B)  valueline.com 
C)  wsj.com 
D)  finance.yahoo.com 
A)  freeedgar.com 
B)  valueline.com 
C)  wsj.com 
D)  finance.yahoo.com

Question 16

Which of the following indexes would best reflect the performance of a large, diversified portfolio with equal amounts of money invested in each company.

Accepted Answer

A)  the S&P 500 Index 
B)  the Russell 3000 
C)  the NASDAQ 100 
D)  the Value Line Composite Index 
A)  the S&P 500 Index 
B)  the Russell 3000 
C)  the NASDAQ 100 
D)  the Value Line Composite Index

Question 17

Which one of the following is NOT published by the U.S. Government?

Accepted Answer

A)  Federal Reserve Bulletin 
B)  Survey of Current Business 
C)  Kiplinger Washington Letter 
D)  Economic Report of the President 
A)  Federal Reserve Bulletin 
B)  Survey of Current Business 
C)  Kiplinger Washington Letter 
D)  Economic Report of the President

Question 18

Describe several appropriate uses of stop-loss orders.

Accepted Answer

Stop loss orders are appropriate when an

Question 19

An index measures the current value of a group of stocks in relation to a base value established previously.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following sites is especially valuable for information concerning mutual funds?

Accepted Answer

A)  www.investopedia.com 
B)  www.morningstar.com 
C)  www.moody's.com 
D)  www.bondsonline.com 
A)  www.investopedia.com 
B)  www.morningstar.com 
C)  www.moody's.com 
D)  www.bondsonline.com

Charting is the technique of

Most brokers charge higher commissions for on-line trades than for telephone transactions.

Ryan places a good-'til-canceled limit order to sell 300 shares of KM at $18 a share. When his order reaches the trading floor, KM is trading at $18.20. Which of the following statements is true concerning Roy's order?

Earnings on securities held in street name by the brokerage are not reported to the Internal Revenue Service.

Market orders are usually executed

Recent studies suggest that, on average, investments clubs

Descriptive information might include the company's lines of business, a list of major competitors, and recent changes in management.

Both the Dow Jones Industrial Average and the Standard & Poor's 500 Index are constructed to reflect the value of shares in large, mid-size and smaller companies.

Small investors normally have a negotiated commission schedule while large investors benefit from a fixed-commission schedule.

A stop-loss order is activated once the stock reaches the specified price.

Heather places an order to buy 525 shares of stock. This is an order for

The Value Line Investment Survey includes which of the following reports? I. Selection and Opinion II. The Outlook III. Ratings and Reports IV. Summary and Index

Traders who hold stocks for less than a full day can reduce the tax burden on their profits.

Which one of the following web sites should you utilize to review the financial information in a company's 10-K report?

Which of the following indexes would best reflect the performance of a large, diversified portfolio with equal amounts of money invested in each company.

Which one of the following is NOT published by the U.S. Government?

Describe several appropriate uses of stop-loss orders.

An index measures the current value of a group of stocks in relation to a base value established previously.

Which of the following sites is especially valuable for information concerning mutual funds?

The Investment Environment

Securities Markets and Transactions

Return and Risk

Modern Portfolio Concepts

Common Stocks

Analyzing Common Stocks

Stock Valuation

Market Efficiency and Behavioral Finance

Fixed-Income Securities

Bond Valuation

Mutual Funds and Exchange-Traded Funds

Managing Your Own Portfolio

Options: Puts and Calls

Futures Markets and Securities

Filters

Exam 3: Investment Information and Securities Transactions

Charting is the technique of

Most brokers charge higher commissions for on-line trades than for telephone transactions.

Ryan places a good-'til-canceled limit order to sell 300 shares of KM at $18 a share. When his order reaches the trading floor, KM is trading at $18.20. Which of the following statements is true concerning Roy's order?

Earnings on securities held in street name by the brokerage are not reported to the Internal Revenue Service.

Market orders are usually executed

Recent studies suggest that, on average, investments clubs

Descriptive information might include the company's lines of business, a list of major competitors, and recent changes in management.

Both the Dow Jones Industrial Average and the Standard & Poor's 500 Index are constructed to reflect the value of shares in large, mid-size and smaller companies.

Small investors normally have a negotiated commission schedule while large investors benefit from a fixed-commission schedule.

A stop-loss order is activated once the stock reaches the specified price.

Heather places an order to buy 525 shares of stock. This is an order for

The Value Line Investment Survey includes which of the following reports? I. Selection and Opinion II. The Outlook III. Ratings and Reports IV. Summary and Index

Traders who hold stocks for less than a full day can reduce the tax burden on their profits.

Which one of the following web sites should you utilize to review the financial information in a company's 10-K report?

Which of the following indexes would best reflect the performance of a large, diversified portfolio with equal amounts of money invested in each company.

Which one of the following is NOT published by the U.S. Government?

Describe several appropriate uses of stop-loss orders.

An index measures the current value of a group of stocks in relation to a base value established previously.

Which of the following sites is especially valuable for information concerning mutual funds?

The Investment Environment

Securities Markets and Transactions

Return and Risk

Modern Portfolio Concepts

Common Stocks

Analyzing Common Stocks

Stock Valuation

Market Efficiency and Behavioral Finance

Fixed-Income Securities

Bond Valuation

Mutual Funds and Exchange-Traded Funds

Managing Your Own Portfolio

Options: Puts and Calls

Futures Markets and Securities

Filters