Question 1

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 2

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 3

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

Question 4

Analytical information would include such information as estimates of growth in sales and future earnings.

Accepted Answer

A) True 
 B)False

Question 5

A brokerage firm which provides analyst reports, investment advice and information as well as online brokerage services is called a(n)

Accepted Answer

A) premium discount broker. 
B) full-service broker. 
C) basic discount broker. 
D) electronic broker. 
A) premium discount broker. 
B) full-service broker. 
C) basic discount broker. 
D) electronic broker.

Question 6

Individuals can now use the Internet to buy and sell
I.stocks.
II.bonds.
III.mutual funds.
IV.stock options.

Accepted Answer

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

Question 7

Stop orders are used only when selling a stock.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following statements concerning day traders are correct?
I.Day traders generally do not hold securities over night.
II.Day trading is a relatively low risk approach to investing.
III.Some day traders sell stocks short.
IV.Day trading was declared illegal by the Market Stabilization Act of 2002.

Accepted Answer

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

Question 9

Investment clubs may only operate under the guidance of a registered investment advisor.

Accepted Answer

A) True 
 B)False

Question 10

Which one of the following statements concerning stock trades is correct?

Accepted Answer

A) Brokerage firms send customer orders to a market maker on the floor of the NYSE. 
B) Confirmation of a trade is transmitted directly from the NYSE to the customer who placed the order. 
C) A broker transmits OTC orders from a customer directly to a floor broker in the OTC market. 
D) Brokerage firms generally hold securities in street name so they can be transferred without the customer's signature. 
A) Brokerage firms send customer orders to a market maker on the floor of the NYSE. 
B) Confirmation of a trade is transmitted directly from the NYSE to the customer who placed the order. 
C) A broker transmits OTC orders from a customer directly to a floor broker in the OTC market. 
D) Brokerage firms generally hold securities in street name so they can be transferred without the customer's signature.

Question 11

The Dow Jones Industrial Average (DJIA)consists of 30 stocks whose price behavior

Accepted Answer

A) typically has little correlation with the rest of the stock market. 
B) broadly reflects the overall price behavior of the stock market. 
C) reflects the changes in value of manufacturing stocks only. 
D) leads the movements in the general economy by one to two weeks. 
A) typically has little correlation with the rest of the stock market. 
B) broadly reflects the overall price behavior of the stock market. 
C) reflects the changes in value of manufacturing stocks only. 
D) leads the movements in the general economy by one to two weeks.

Question 12

Why are market averages and indexes useful to investors?

Accepted Answer

By comparing the values of various avera

Question 13

The value of a Standard & Poor's Index is computed by

Accepted Answer

A) dividing the sum of the closing share prices by an adjusted divisor. 
B) dividing the sum of the closing share prices by a divisor and then multiplying the quotient by 100. 
C) dividing the sum of the current market value of all the stocks in the index by a divisor adjusted for changes in the companies composing the Index. 
D) dividing the sum of the current market value of all the stocks in the index by a divisor that adjusts for stock splits and scales the Index figure to a manageable size. 
A) dividing the sum of the closing share prices by an adjusted divisor. 
B) dividing the sum of the closing share prices by a divisor and then multiplying the quotient by 100. 
C) dividing the sum of the current market value of all the stocks in the index by a divisor adjusted for changes in the companies composing the Index. 
D) dividing the sum of the current market value of all the stocks in the index by a divisor that adjusts for stock splits and scales the Index figure to a manageable size.

Question 14

Commissions for on-line trades are considerable lower than for orders placed with a full-service broker.

Accepted Answer

A) True 
 B)False

Question 15

Which one of the following is a measure of the performance of small companies?

Accepted Answer

A) Russell 2000 
B) Russell 1000 
C) Russell 3000 
D) Value Line 1700 
A) Russell 2000 
B) Russell 1000 
C) Russell 3000 
D) Value Line 1700

Question 16

Which of the following statements about the Dow Jones Industrial Average are correct?
I.Higher-priced stocks tend to affect the average more than lower-priced stocks.
II.A one-point change in the DJIA correlates to a $1 change in average share value.
III.Changes in the DJIA are made to reflect company mergers and acquisitions.
IV.The DJIA divisor was determined when the average was created and remains constant.

Accepted Answer

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

Question 17

A fill-or-kill order will be

Accepted Answer

A) executed immediately upon order arrival on the floor of the exchange. 
B) will be cancelled if not immediately executed at the stated price or better. 
C) will be cancelled at the end of the trading day if not executed by that time. 
D) in effect until cancelled by the customer who placed the order. 
A) executed immediately upon order arrival on the floor of the exchange. 
B) will be cancelled if not immediately executed at the stated price or better. 
C) will be cancelled at the end of the trading day if not executed by that time. 
D) in effect until cancelled by the customer who placed the order.

Question 18

SIPC insurance is offered by some full-service brokers to protect investors from large losses.

Accepted Answer

A) True 
 B)False

Question 19

Which one of the following indexes reflects a large sample of small, medium sized and large companies?

Accepted Answer

A) NYSE composite 
B) DJIA 
C) Russell 3000 
D) Value Line composite 
A) NYSE composite 
B) DJIA 
C) Russell 3000 
D) Value Line composite

Question 20

The Dow Jones Corporate Bond Indexes is based

Accepted Answer

A) the yield to maturity of bonds in the index. 
B) annual rates of return and assume the bonds were purchased one year ago and sold today. 
C) the interest rates offered on a sample of newly issued bonds. 
D) the closing prices of bonds in the index. 
A) the yield to maturity of bonds in the index. 
B) annual rates of return and assume the bonds were purchased one year ago and sold today. 
C) the interest rates offered on a sample of newly issued bonds. 
D) the closing prices of bonds in the index.

Recent studies suggest that, on average, investments clubs

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

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

Analytical information would include such information as estimates of growth in sales and future earnings.

A brokerage firm which provides analyst reports, investment advice and information as well as online brokerage services is called a(n)

Individuals can now use the Internet to buy and sell I.stocks. II.bonds. III.mutual funds. IV.stock options.

Stop orders are used only when selling a stock.

Investment clubs may only operate under the guidance of a registered investment advisor.

Which one of the following statements concerning stock trades is correct?

The Dow Jones Industrial Average (DJIA)consists of 30 stocks whose price behavior

Why are market averages and indexes useful to investors?

The value of a Standard & Poor's Index is computed by

Commissions for on-line trades are considerable lower than for orders placed with a full-service broker.

Which one of the following is a measure of the performance of small companies?

A fill-or-kill order will be

SIPC insurance is offered by some full-service brokers to protect investors from large losses.

Which one of the following indexes reflects a large sample of small, medium sized and large companies?

The Dow Jones Corporate Bond Indexes is based

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

Recent studies suggest that, on average, investments clubs

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

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

Analytical information would include such information as estimates of growth in sales and future earnings.

A brokerage firm which provides analyst reports, investment advice and information as well as online brokerage services is called a(n)

Individuals can now use the Internet to buy and sell I.stocks. II.bonds. III.mutual funds. IV.stock options.

Stop orders are used only when selling a stock.

Investment clubs may only operate under the guidance of a registered investment advisor.

Which one of the following statements concerning stock trades is correct?

The Dow Jones Industrial Average (DJIA)consists of 30 stocks whose price behavior

Why are market averages and indexes useful to investors?

The value of a Standard & Poor's Index is computed by

Commissions for on-line trades are considerable lower than for orders placed with a full-service broker.

Which one of the following is a measure of the performance of small companies?

A fill-or-kill order will be

SIPC insurance is offered by some full-service brokers to protect investors from large losses.

Which one of the following indexes reflects a large sample of small, medium sized and large companies?

The Dow Jones Corporate Bond Indexes is based

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