Deck 21: Stocks, Bonds, and Mutual Funds

Question 1

The stock yield is the monthly dividend divided by the closing price per share.

Answer 1

False

Question 2

The general public is allowed to trade stock on the floor of the stock exchange.

Answer 2

False

Question 3

If someone buys a bond for less than $1,000, that person will receive less annual interest.

Answer 3

False

Question 4

The price-earnings ratio of stocks is not standard.

Question 5

The current yield on a bond is the yearly interest of the bond divided by the cost of the bond at closing.

Question 6

The previous day's close of a stock is listed in today's transactions.

Question 7

Stocks are traded over the Internet.

Question 8

The yearly interest on a bond is the current selling price of the bond times the stated yearly interest rate.

Question 9

Stock represents shares of ownership in a company.

Question 10

Bond quotes are stated in percents of face value.

Question 11

Bond price-earnings ratios are similar to those of stocks.

Question 12

A company that has no PE ratio has no earnings.

Question 13

A bond yield is the total annual interest of a bond divided by the total current cost of the bond.

Question 14

A bond selling for more than the face value is selling at a premium.

Question 15

Stocks are quoted in decimals.

Question 16

Bonds do not repay the face value in the future.

Question 17

Each time the stock of a company trades on the exchange, the company receives additional money.

Question 18

A bond quote of 74.375 is $743.50.

Question 19

Cumulative preferred stock is not entitled to dividends in arrears.

Question 20

A commission is charged only when one is buying a stock.

Question 21

Bond quotes are stated in:

A)Dollars
B)Fractions of a dollar
C)Percents of face value
D)Percents of purchase price
E)None of these

Question 22

Dividends in arrears mean:

A)No past dividends have been omitted
B)Preferred has been paid but not holders of common stock
C)Common stock must receive additional dividends not paid
D)A specific amount of dividends has not been paid
E)None of these

Question 23

Stock yield is found by the annual dividend divided by the:

A)Opening price per share
B)Closing price per share
C)Price-earnings ratio
D)Net change for the day
E)None of these

Question 24

A bond that closed today at 94 down 2 closed yesterday in dollars at:

A)$960
B)$940
C)$950
D)$930
E)None of these

Question 25

ARUN stock closed at $8.11 + $0.33. Yesterday's closing price was:

A)$8.44
B)$8.40
C)$7.78
D)$7.87
E)None of these

Question 26

The yearly interest of a bond is the face value of the bond:

A)Divided by the stated yearly interest rate
B)Plus the stated yearly interest rate
C)Times the stated yearly interest rate
D)Minus the stated yearly interest rate
E)None of these

Question 27

A stock price will rise if:

A)Supply of stock is greater than demand
B)The price-earnings ratio is 10 or greater
C)Stock yield is greater than 8%
D)Demand for stock is greater than supply
E)None of these

Question 28

Commissions charged on the trading of stock are:

A)Only on buying of stock
B)On buying and selling of stock
C)Only on sale of stock
D)Fixed
E)None of these

Question 29

The price-earnings ratio is calculated by the closing price per share of stock divided by:

A)Quarterly earnings per share
B)Dividend per year
C)Annual earnings per share
D)Net change
E)None of these

Question 30

Stockbrokers:

A)Do not act as middlemen
B)Cannot trade stock
C)Charge a commission for buying and selling
D)Are always right in all their stock recommendations
E)None of these

Question 31

The NAV helps an investor keep track of the value of his or her investment.

Question 32

The offer price of a mutual fund is always the NAV and commission.

Question 33

A mutual fund is made up of

A)Many stocks
B)10 stocks
C)100 stocks
D)500 stocks
E)None of these

Question 34

Stocks are always quoted in:

A)Percents
B)Quarters of a dollar
C)Decimals
D)Quarter lots
E)None of these

Question 35

A low-load fund is bought directly from the investment company.

Question 36

Bonds are usually in denominations of:

A)$100
B)$1,000
C)$10,000
D)$100,000
E)None of these

Question 37

Preferred stock can:

A)Be cumulative
B)Have equal rights to common stock
C)Never receive dividends in arrears
D)Never have preference to dividends over common stockholders
E)None of these

Question 38

The NAV is the dollar value of 10 shares of a mutual fund.

Question 39

A mutual fund is an investment company that buys stocks and bonds and then sells shares in those securities to the public.

Question 40

A bond quote of 82.25 in dollars is equal to:

A)$82.25
B)$8.25
C)$8,025.50
D)$822.50
E)None of these

Question 41

In April, Sandi sold 1,600 shares of Federal Express at $105.00 per share. In May, the stock reached a low during the Great Recession and was selling for $32.00 per share. Sandi used the proceeds from the sale and repurchased Federal Express at $32.00 per share in May. What is the value of Sandi's stock holdings in Federal Express if the shares are selling for $91.00 today?

A)$168,000
B)$51,200
C)$477,750
D)$239,000
E)None of these

Question 42

The stock of MNC Inc. pays a dividend of $3.44. The stock opened at $89.19 and closed at $90.28. The stock yield is:

A)3.8%
B)3.2%
C)3.1%
D)4.9%
E)None of these

Question 43

Jangles Co. earned $1.80 per share. Assuming a closing price of $40, the PE ratio is (round to the nearest whole answer):

A)7
B)22
C)72
D)20
E)None of these

Question 44

Fidelity Investments is selling a real estate income mutual fund for $10.94 per share. The fund charges a load of 2.5%. What is the offer price?

A)$10.94
B)$10.67
C)$11.21
D)$11.48
E)None of these

Question 45

A bond closed at 102.25. The current yield is 10.4%. The annual interest is:

A)$102.90
B)$106.34
C)$105.80
D)$104.60
E)None of these

Question 46

The stock of VIC Corporation is trading at $39.63. The price-earnings ratio is 16 times earnings. The earnings per share for VIC Corporation are:

A)$2.84
B)$2.48
C)$4.96
D)$6.34
E)None of these

Question 47

Loretta Scholten buys nine bonds of Leo Co. 7 1/4 16 at 103.375. The commission is $3.00 per bond. The current yield to the nearest tenth of a percent is:

A)7.0%
B)7.1%
C)7.2%
D)7.3%
E)None of these

Question 48

TOX bond 7.55 yields 11%. The bond traded at a low of 71.25 and closed today at 71.625 + 0.75. The closing price yesterday was:

A)65.125
B)72.375
C)69.875
D)70.875
E)None of these

Question 49

Abby Ring buys five bonds of Moe Co. 12 3/4 15 at 89.375 with a commission of $5.00 per bond. Her total annual interest is:

A)$127.50
B)$637.05
C)$1,275
D)$637.50
E)None of these

Question 50

Zolt Inc. (ZOLT)stock is selling for $8.22 per share with an EPS of .45 cents per share. What is Zolt's PE ratio? (Round to nearest tenth.)

A)18.3
B)19.5
C)8.3
D)20.0
E)None of these

Question 51

Bee Sting bought 400 shares of Google at $1238.16 per share. Assume a commission of 2% of the purchase price. What is the total to Bee?

A)$1,238.16
B)$9,905.28
C)$495,164
D)$505,169.28
E)None of these

Question 52

Ace Corporation pays its cumulative preferred stock $1.95 per share. There are 40,000 shares of preferred and 80,000 shares of common. In 2016, 2017, and 2018, because of slowdowns in the economy, Ace paid no dividends. Now, in 2019, the board of directors has decided to pay out $600,000 in dividends. The common stockholders receive:

A)$312,000
B)$288,000
C)$366,000
D)$444,000
E)None of these

Question 53

McDonald's Corp (MCD)stock is selling for $156.21 per share. They offer a dividend of $5.22 per share. What is the stock yield? (Round to nearest tenth percent.)

A)3.3%
B)0.033%
C)2.8%
D)0.059%
E)None of these

Question 54

Royal Co. receives a dividend of $4.88 per share. Today the closing price of the stock is $59.95. The current stock yield to the nearest tenth of a percent is:

A)8.1%
B)8.0%
C)8.2%
D)8.3%
E)None of these

Question 55

Exxon sells its bonds at 108.375. The amount of premium or discount the bond is selling for is:

A)$17.35
B)$13.75
C)$13.25
D)$13.57
E)None of these

Question 56

Jeff Ryan bought 200 shares of BUI for $19.50. Eight weeks later he sold the stock for $20.75. Assuming a 3% commission, his bottom line was a gain of:

A)$250.00
B)$374.50
C)$8.50
D)$257.50
E)None of these

Question 57

The bond of Tuckpeck is 8¼ 14. The bond traded for a high of 93.25 and closed at 93. The current yield of the bond to the nearest tenth of a percent is:

A)8.8%
B)8.7%
C)8.9%
D)8.6%
E)None of these

Question 58

Al Roy bought five bonds of Jort Co. 11 3/4 at 93.25 and four bonds of Inst. System 12 3/4 for 81.125. If the commissions on the bonds are $2.50 per bond, the total cost of all the purchases is:

A)$4,662.50
B)$3,425.00
C)$7,930.00
D)$7,907.50
E)None of these

Question 59

Ron bought one bond of Bee Company for 82.25. The original bond was 6 3/4 15. The current yield is (to the nearest tenth of a percent):

A)8%
B)8.2%
C)8.3%
D)9%
E)None of these

Question 60

Amy purchased 100 shares of Monsanto Company for $66.10 per share. Today the stock is selling for $80.45. Assuming a charge of $7.00 to buy and sell, how much did Amy earn if she sold her shares today?

A)$6,617
B)$8,038
C)$1,421
D)$14,655
E)None of these

Question 61

Assume $1.19 EPS. What was yesterday's closing price?
$$\begin{array} { | c | c | c | c | c | c | c | c | c | } \hline { \text { 52 Weeks } } & \begin{array} { c } \text { Stock } \\\text { (Sym) }\end{array} & \text { DIV } & \begin{array} { c } \text { YLD } \\\%\end{array} & \text { PE } & \begin{array} { c } \text { Volume } \\( 100 \text { 's } )\end{array} & \text { Close } & \begin{array} { c } \text { Net } \\\text { Change }\end{array} \\\hline \text { HI } \mid \text { LO } & & & & & & & \\\hline 34 \mid21.56 & \text { Kellogg K } & 1.01 & & & 10103 & 32.13 & - 0.07 \\\hline\end{array}$$

Question 62

Match the following terms with their definitions.

-Decimals

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 63

What is the total interest for 1 year on this bond?
$$\begin{array} { | l | l | l | l | l | } \hline \text { Bond } & \text { Current Yield } & \text { Vol } & \text { Close } & \text { Net Change } \\\hline \text { HWL } 8\frac {\text { 1}} { \text {2 } }\quad23& & 12 & 67.75 & + 7 \\\hline\end{array}$$

Question 64

What is the Current Yield on this bond (to the nearest tenth percent), based on the closing price?
$$\begin{array} { | l | l | l | l | l | } \hline \text { Bond } & \text { Current Yield } & \text { Vol } & \text { Close } & \text { Net Change } \\\hline \text { HWL } 8\frac {\text { 1}} { \text {2 } }\quad23& ? & 12 & 67.75 & + 7 \\\hline\end{array}$$

Question 65

Assume $1.19 EPS. What was the sales volume?
$$\begin{array} { | c | c | c | c | c | c | c | c | c | } \hline { \text { 52 Weeks } } & \begin{array} { c } \text { Stock } \\\text { (Sym) }\end{array} & \text { DIV } & \begin{array} { c } \text { YLD } \\\%\end{array} & \text { PE } & \begin{array} { c } \text { Volume } \\( 100 \text { 's } )\end{array} & \text { Close } & \begin{array} { c } \text { Net } \\\text { Change }\end{array} \\\hline \text { HI } \mid\text { LO } & & & & & & & \\\hline 34\mid 21.56 & \text { Kellogg K } & 1.01 & & ? & 10103 & 32.13 & - 0.07 \\\hline\end{array}$$

Question 66

Match the following terms with their definitions.

-Bonds

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 67

Assume $1.19 EPS. What was the lowest price at which the stock traded for the year?
$$\begin{array} { | c | c | c | c | c | c | c | c | c | } \hline { \text { 52 Weeks } } & \begin{array} { c } \text { Stock } \\\text { (Sym) }\end{array} & \text { DIV } & \begin{array} { c } \text { YLD } \\\%\end{array} & \text { PE } & \begin{array} { c } \text { Volume } \\( 100 \text { 's } )\end{array} & \text { Close } & \begin{array} { c } \text { Net } \\\text { Change }\end{array} \\\hline \text { HI } \mid \text { LO } & & & & & & & \\\hline 34 \mid 21.56 & \text { Kellogg K } & 1.01 & & ? & 10103 & 32.13 & - 0.07 \\\hline\end{array}$$

Question 68

Match the following terms with their definitions.

-Cumulative preferred

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 69

Assume $1.19 EPS. For the year, what was the highest price at which the stock traded?
$$\begin{array} { | c | c | c | c | c | c | c | c | c | } \hline { \text { 52 Weeks } } & \begin{array} { c } \text { Stock } \\\text { (Sym) }\end{array} & \text { DIV } & \begin{array} { c } \text { YLD } \\\%\end{array} & \text { PE } & \begin{array} { c } \text { Volume } \\( 100 \text { 's } )\end{array} & \text { Close } & \begin{array} { c } \text { Net } \\\text { Change }\end{array} \\\hline \text { HI } \mid \text { LO } & & & & & & & \\\hline 34 \mid 21.56 & \text { Kellogg K } & 1.01 & & ? & 10103 & 32.13 & - 0.07 \\\hline\end{array}$$

Question 70

Match the following terms with their definitions.

-Bond premium

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 71

Match the following terms with their definitions.

-Sym

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 72

Match the following terms with their definitions.

-Common stock

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 73

Match the following terms with their definitions.

-Bond yield

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 74

Match the following terms with their definitions.

-Cash dividend

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 75

Match the following terms with their definitions.

-NAV

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 76

Assume $1.19 EPS. Calculate the yield percent (round to the nearest tenth percent).
$$\begin{array} { | c | c | c | c | c | c | c | c | c | } \hline { \text { 52 Weeks } } & \begin{array} { c } \text { Stock } \\\text { (Sym) }\end{array} & \text { DIV } & \begin{array} { c } \text { YLD } \\\%\end{array} & \text { PE } & \begin{array} { c } \text { Volume } \\( 100 \text { 's } )\end{array} & \text { Close } & \begin{array} { c } \text { Net } \\\text { Change }\end{array} \\\hline \text { HI } \mid \text { LO } & & & & & & & \\\hline 34 \mid 21.56 & \text { Kellogg K } & 1.01 & & ? & 10103 & 32.13 & - 0.07 \\\hline\end{array}$$

Question 77

Match the following terms with their definitions.

-Stock yield

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 78

Match the following terms with their definitions.

-No-load fund

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000

Question 79

Assume $1.19 EPS. Calculate the PE number (round to the nearest whole number).
$\begin{array}{|c|c|c|c|c|c|c|c|c}\hline& \text { Stock } & & \text { YLD } && \text { Volume } & & \text { Net }\\\text { 52 Weeks } & \text { (Sym) } & \text { DIV } &\%& \text { PE } & \text { (100's) } & \text { Close } & \text { Change } \\\hline \text { HI }\mid \text { LO } & & & & & & & \\\hline 34 \mid 21.56 & \text { Kellogg K } & 1.01 & & ? & 10103 & 32.13 & -0.07 \\\hline\end{array}$

Question 80

Match the following terms with their definitions.

-Price-earnings ratio

A)Bond sells for more than face value
B)Symbol of stock
C)Total interest divided by total cost
D)Dividend in arrears is paid before common price
E)What shares are quoted in
F)Dividend per share divided by closing price
G)No sales charge
H)Price per share divided by earnings per share
I)Payment to stockholder
J)A type of stock
K)Dollar value of one share of a mutual fund
L)Denominations of $1,000