Question 1

Based upon the following information:   What is the dollar amount of interest paid annually on a $1,000 POP bond?

Accepted Answer

A)  $ 70.00 
B)  $ 90.00 
C)  $ 97.50 
D)  $107.50 
E)  $110.50 
A)  $ 70.00 
B)  $ 90.00 
C)  $ 97.50 
D)  $107.50 
E)  $110.50

Question 2

Most preferred stock is

Accepted Answer

A)  cumulative. 
B)  convertible. 
C)  noncumulative. 
D)  callable. 
E)  none of these. 
A)  cumulative. 
B)  convertible. 
C)  noncumulative. 
D)  callable. 
E)  none of these.

Question 3

A bond is issued at $1,000 par value during a time in which interest rates for similar bonds were 8%.Today new bonds issued with a similar credit worthiness is 10%.Which of the following is most likely to be true about the bond.

Accepted Answer

A)  It is currently selling for a premium 
B)  It is currently selling at a discount 
C)  currently selling at par 
D)  The bond is likely to be called 
E)  none of the above 
A)  It is currently selling for a premium 
B)  It is currently selling at a discount 
C)  currently selling at par 
D)  The bond is likely to be called 
E)  none of the above

Question 4

Municipal bonds can be attractive investments,despite their lower interest rate,since their interest income is exempt from federal income tax.

Accepted Answer

A) True 
 B)False

Question 5

There is an inverse relationship between the bond prices and current interest rates.

Accepted Answer

A) True 
 B)False

Question 6

The easiest way to invest in foreign stock is to purchase

Accepted Answer

A)  the stock directly from an over sea's broker. 
B)  the stock directly from your regular broker. 
C)  the stock directly over the Internet. 
D)  international mutual funds. 
E)  American Depository Receipts. 
A)  the stock directly from an over sea's broker. 
B)  the stock directly from your regular broker. 
C)  the stock directly over the Internet. 
D)  international mutual funds. 
E)  American Depository Receipts.

Question 7

Calculate the approximate yield on the common stock of Bowl Game that Matty Smelt has owned for 4 years.She bought it for $10 per share and sold it for $25.The dividend was $1.50 each year.(Show all work. )

Accepted Answer

The answer of Calculate the approximate yield on the common...

Question 8

The ____ of a stock reflects stockholder confidence.

Accepted Answer

A)  par value 
B)  book value 
C)  face value 
D)  price/earnings ratio 
E)  dividend yield 
A)  par value 
B)  book value 
C)  face value 
D)  price/earnings ratio 
E)  dividend yield

Question 9

Base upon the following information:   What is the current yield on this bond?

Accepted Answer

A)  5.00% 
B)  8.82% 
C)  9.75% 
D)  11.00% 
E)  11.50% 
A)  5.00% 
B)  8.82% 
C)  9.75% 
D)  11.00% 
E)  11.50%

Question 10

A lower expected return will mean a higher risk will have to be accepted.

Accepted Answer

A) True 
 B)False

Question 11

Stock dividends are taxed at Long Term Capital Gains Rates.

Accepted Answer

A) True 
 B)False

Question 12

Advantages of common stock investments include

Accepted Answer

A)  guaranteed dividend income. 
B)  potential for high return 
C)  liquidity. 
D)  b and c 
E)  a,b,and c 
A)  guaranteed dividend income. 
B)  potential for high return 
C)  liquidity. 
D)  b and c 
E)  a,b,and c

Question 13

Base upon the following information:   POP closed on this trading day at a price of

Accepted Answer

A)  $ 975. 
B)  $1,000. 
C)  $1,105. 
D)  $1,200. 
E)  None 
A)  $ 975. 
B)  $1,000. 
C)  $1,105. 
D)  $1,200. 
E)  None

Question 14

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Zero-coupon bonds would be more appropriate for a [tax-deferred retirement account | taxable account].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 15

Dividend Reinvestment Plans provide shareholders with cash,so that they can invest in similar stocks.

Accepted Answer

A) True 
 B)False

Question 16

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-You are looking for a relatively steady stream of income with some potential for growth;you should invest in [income stocks | growth stocks].

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Question 17

Which of the following types of risk affect owners of fixed income securities more than owners of equity securities

Accepted Answer

A)  business risk 
B)  financial risk 
C)  market risk 
D)  purchasing power risk 
E)  none of the above 
A)  business risk 
B)  financial risk 
C)  market risk 
D)  purchasing power risk 
E)  none of the above

Question 18

Investors typically welcome their bonds being called because of the generous call premium paid.

Accepted Answer

A) True 
 B)False

Question 19

Companies with a great deal of long-term debt would rate fairly high in ____ risk.

Accepted Answer

A)  market 
B)  event 
C)  business 
D)  financial 
E)  liquidity 
A)  market 
B)  event 
C)  business 
D)  financial 
E)  liquidity

Question 20

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement.
-Most purchasers of [Treasury | municipal] bonds invest in them because of their tax-free interest.

Accepted Answer

The answer of INSTRUCTIONS: Choose the word or phrase in...

Based upon the following information: What is the dollar amount of interest paid annually on a $1,000 POP bond?

Most preferred stock is

A bond is issued at $1,000 par value during a time in which interest rates for similar bonds were 8%.Today new bonds issued with a similar credit worthiness is 10%.Which of the following is most likely to be true about the bond.

Municipal bonds can be attractive investments,despite their lower interest rate,since their interest income is exempt from federal income tax.

There is an inverse relationship between the bond prices and current interest rates.

The easiest way to invest in foreign stock is to purchase

Calculate the approximate yield on the common stock of Bowl Game that Matty Smelt has owned for 4 years.She bought it for $10 per share and sold it for $25.The dividend was $1.50 each year.(Show all work. )

The ____ of a stock reflects stockholder confidence.

Base upon the following information: What is the current yield on this bond?

A lower expected return will mean a higher risk will have to be accepted.

Stock dividends are taxed at Long Term Capital Gains Rates.

Advantages of common stock investments include

Base upon the following information: POP closed on this trading day at a price of

Dividend Reinvestment Plans provide shareholders with cash,so that they can invest in similar stocks.

Which of the following types of risk affect owners of fixed income securities more than owners of equity securities

Investors typically welcome their bonds being called because of the generous call premium paid.

Companies with a great deal of long-term debt would rate fairly high in ____ risk.

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 12: Investing in Stocks and Bonds

Based upon the following information: What is the dollar amount of interest paid annually on a $1,000 POP bond?

Most preferred stock is

A bond is issued at $1,000 par value during a time in which interest rates for similar bonds were 8%.Today new bonds issued with a similar credit worthiness is 10%.Which of the following is most likely to be true about the bond.

Municipal bonds can be attractive investments,despite their lower interest rate,since their interest income is exempt from federal income tax.

There is an inverse relationship between the bond prices and current interest rates.

The easiest way to invest in foreign stock is to purchase

Calculate the approximate yield on the common stock of Bowl Game that Matty Smelt has owned for 4 years.She bought it for $10 per share and sold it for $25.The dividend was $1.50 each year.(Show all work. )

The ____ of a stock reflects stockholder confidence.

Base upon the following information: What is the current yield on this bond?

A lower expected return will mean a higher risk will have to be accepted.

Stock dividends are taxed at Long Term Capital Gains Rates.

Advantages of common stock investments include

Base upon the following information: POP closed on this trading day at a price of

Dividend Reinvestment Plans provide shareholders with cash,so that they can invest in similar stocks.

Which of the following types of risk affect owners of fixed income securities more than owners of equity securities

Investors typically welcome their bonds being called because of the generous call premium paid.

Companies with a great deal of long-term debt would rate fairly high in ____ risk.

Understanding the Financial Planning Process

Your Financial Statements and Plans

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investment Planning

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters