Exam 11: Investment Planning

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. -Asset allocation is another term for [selecting the stocks you want to buy | deciding what percentage of your investment you want in stocks].

A limit order may be used either to buy or to sell.

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. -An order to buy or sell a security at the best price available at the time the order is received is a [market | limit] order.

The margin required on the purchase of common stock is currently set at

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. -An investment offering a high current income would likely be more desirable for [a young couple | a retired couple].

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 deep discount broker will execute orders as well as [pick the stocks for you to buy | provide extensive information about various securities].

Preferred stocks are the common stocks of ultra blue-chip companies.

If a company's common stock is traded on an exchange,the company is said to be

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. -Margin requirements are set by the [SEC | Federal Reserve].

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 [bull | bear] market is characterized by rising stock prices.

Commodities markets trade options to buy and sell options to buy common stocks.

The most stringent listing requirements would be found on the

On-line trading is the only valuable investment service available through the Internet.

Selling equities you don't own and buying them back to cover the sale is

Buying on margin is buying

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 maximum amount of money you could lose in a short sale is [known | unknown] at the time of the transaction.

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 largest stock exchange outside the US is in [London | Tokyo].

The National Market System lists ____ traded over the counter.

Monte wants to save for his daughter's college education.He would like to have $85,000 in 15 years.If Monte can earn an average of 8.5% on this fund,how much would he need to deposit in the account today to meet his goal? If Monte has no money to set aside now but wants to save at the end of each month for this goal,how much would he need to add to the account each month?

The SEC requires corporations to issue ____ describing the firm and the security issue it wishes to sell.