Question 1

When evaluating a stock as a possible investment,one must consider

Accepted Answer

A)  the current market price. 
B)  the expected capital gain. 
C)  the expected dividend income. 
D)  one's investment goals. 
E)  all of the above 
A)  the current market price. 
B)  the expected capital gain. 
C)  the expected dividend income. 
D)  one's investment goals. 
E)  all of the above

Question 2

Bonds represent a form of corporate debt capital.

Accepted Answer

A) True 
 B)False

Question 3

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.
-The [lower | higher] a bond's rating,the more likely the issuer will default.

Accepted Answer

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

Question 4

Typically,common stockholders get to cast one vote for each round lot of stock they own.

Accepted Answer

A) True 
 B)False

Question 5

The Smith family owns 200 shares of Elta stock.The company declared a 5% stock dividend.The Smiths now own

Accepted Answer

A)  200 shares. 
B)  205 shares. 
C)  210 shares. 
D)  420 shares. 
E)  410 shares. 
A)  200 shares. 
B)  205 shares. 
C)  210 shares. 
D)  420 shares. 
E)  410 shares.

Question 6

Which of the following would be a disadvantage of owning an income stock?

Accepted Answer

A)  High and growing dividends 
B)  High but declining dividends 
C)  Lower growth potential 
D)  High potential for capital growth 
E)  Tend to be solid blue chip stocks 
A)  High and growing dividends 
B)  High but declining dividends 
C)  Lower growth potential 
D)  High potential for capital growth 
E)  Tend to be solid blue chip stocks

Question 7

You would expect more growth with the preferred stock you own than with the common stock in your portfolio.

Accepted Answer

A) True 
 B)False

Question 8

A stronger dollar has a positive effect on the total returns U.S.investors receive on foreign securities.

Accepted Answer

A) True 
 B)False

Question 9

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.
-Individuals invest in preferred stock for its high [current income | potential gain].

Accepted Answer

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

Question 10

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.
-Stock dividends represent [taxable | nontaxable] income.

Accepted Answer

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

Question 11

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.
-A [cyclical | defensive] stock's price would tend to move in the same direction as the entire market.

Accepted Answer

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

Question 12

____ stocks are really purchased as a gamble rather then because they have a proven history of good performance.

Accepted Answer

A)  Blue-chip 
B)  Growth 
C)  Cyclical 
D)  Defensive 
E)  Speculative 
A)  Blue-chip 
B)  Growth 
C)  Cyclical 
D)  Defensive 
E)  Speculative

Question 13

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.
-If you buy a bond at a premium,its yield to maturity will be [higher | lower] than the coupon yield.

Accepted Answer

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

Question 14

If Wristwatch Arm Corporation (WAC)has assets of $10 million,liabilities of $5 million,and preferred stock of $1 million,its book value is $6 million.

Accepted Answer

A) True 
 B)False

Question 15

Stocks with high betas will have larger price gains and losses than those with low betas.

Accepted Answer

A) True 
 B)False

Question 16

Earnings per share (EPS)tell the stockholder the amount of dividend earned.

Accepted Answer

A) True 
 B)False

Question 17

Sunshine Mining Bonds have a $1,000 face value,pay $95 annual interest,mature in 2004,and are currently quoted at $1,302.50.The coupon rate of interest is

Accepted Answer

A)  8.500%. 
B)  9.500%. 
C)  13.025%. 
D)  13.052%. 
E)  can't tell from the information given. 
A)  8.500%. 
B)  9.500%. 
C)  13.025%. 
D)  13.052%. 
E)  can't tell from the information given.

Question 18

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.
-Preferred stockholders will receive their share of company earnings [before | after] bond interest is paid.

Accepted Answer

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

Question 19

If the current price of an investment increases,the investment's annual yield will decrease.

Accepted Answer

A) True 
 B)False

Question 20

Only the strongest,most stable and safe-return companies can be called

Accepted Answer

A)  blue chip stocks. 
B)  growth companies. 
C)  income stocks. 
D)  defensive stocks. 
E)  cyclical stocks. 
A)  blue chip stocks. 
B)  growth companies. 
C)  income stocks. 
D)  defensive stocks. 
E)  cyclical stocks.

When evaluating a stock as a possible investment,one must consider

Bonds represent a form of corporate debt capital.

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. -The [lower | higher] a bond's rating,the more likely the issuer will default.

Typically,common stockholders get to cast one vote for each round lot of stock they own.

The Smith family owns 200 shares of Elta stock.The company declared a 5% stock dividend.The Smiths now own

Which of the following would be a disadvantage of owning an income stock?

You would expect more growth with the preferred stock you own than with the common stock in your portfolio.

A stronger dollar has a positive effect on the total returns U.S.investors receive on foreign securities.

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. -Individuals invest in preferred stock for its high [current income | potential gain].

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. -Stock dividends represent [taxable | nontaxable] income.

____ stocks are really purchased as a gamble rather then because they have a proven history of good performance.

If Wristwatch Arm Corporation (WAC)has assets of $10 million,liabilities of $5 million,and preferred stock of $1 million,its book value is $6 million.

Stocks with high betas will have larger price gains and losses than those with low betas.

Earnings per share (EPS)tell the stockholder the amount of dividend earned.

Sunshine Mining Bonds have a $1,000 face value,pay $95 annual interest,mature in 2004,and are currently quoted at $1,302.50.The coupon rate of interest is

If the current price of an investment increases,the investment's annual yield will decrease.

Only the strongest,most stable and safe-return companies can be called

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

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Exam 12: Investing in Stocks and Bonds

When evaluating a stock as a possible investment,one must consider

Bonds represent a form of corporate debt capital.

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. -The [lower | higher] a bond's rating,the more likely the issuer will default.

Typically,common stockholders get to cast one vote for each round lot of stock they own.

The Smith family owns 200 shares of Elta stock.The company declared a 5% stock dividend.The Smiths now own

Which of the following would be a disadvantage of owning an income stock?

You would expect more growth with the preferred stock you own than with the common stock in your portfolio.

A stronger dollar has a positive effect on the total returns U.S.investors receive on foreign securities.

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. -Individuals invest in preferred stock for its high [current income | potential gain].

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. -Stock dividends represent [taxable | nontaxable] income.

____ stocks are really purchased as a gamble rather then because they have a proven history of good performance.

If Wristwatch Arm Corporation (WAC)has assets of $10 million,liabilities of $5 million,and preferred stock of $1 million,its book value is $6 million.

Stocks with high betas will have larger price gains and losses than those with low betas.

Earnings per share (EPS)tell the stockholder the amount of dividend earned.

Sunshine Mining Bonds have a $1,000 face value,pay $95 annual interest,mature in 2004,and are currently quoted at $1,302.50.The coupon rate of interest is

If the current price of an investment increases,the investment's annual yield will decrease.

Only the strongest,most stable and safe-return companies can be called

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