Question 1

What are the main factors that must be considered before a company decides to raise money through issuing bonds? Why are they important?

Accepted Answer

The interest rate is of prime importance

Question 2

A bear market occurs when stocks have bottomed out and investor confidence is shifting from negative to positive.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following bonds has the shortest maturity date?

Accepted Answer

A) Treasury bills 
B) Treasury bonds 
C) Treasury notes 
D) All three types of bonds have the same maturity date. 
A) Treasury bills 
B) Treasury bonds 
C) Treasury notes 
D) All three types of bonds have the same maturity date.

Question 4

An investor with a strong appetite for risk should purchase a(n)________.

Accepted Answer

A) cyclical stock 
B) blue chip stock 
C) growth stock 
D) income stock 
A) cyclical stock 
B) blue chip stock 
C) growth stock 
D) income stock

Question 5

A bear market is distinguished by ________.

Accepted Answer

A) a declining stock market and increasing investor confidence 
B) a declining stock market and decreasing investor confidence 
C) an increasing stock market and increasing investor confidence 
D) an increasing stock market and decreasing investor confidence 
A) a declining stock market and increasing investor confidence 
B) a declining stock market and decreasing investor confidence 
C) an increasing stock market and increasing investor confidence 
D) an increasing stock market and decreasing investor confidence

Question 6

An asset allocation of 95% stocks and 5% bonds is considered ________ risk.

Accepted Answer

A) conservative 
B) moderate 
C) no 
D) aggressive 
A) conservative 
B) moderate 
C) no 
D) aggressive

Question 7

A(n)________ stock is issued by a company that has a long history of consistent growth and stability and often pays regular dividends.

Accepted Answer

A) blue chip 
B) income 
C) defensive 
D) cyclical 
A) blue chip 
B) income 
C) defensive 
D) cyclical

Question 8

A "sinking fund" is a corporate bond that is declining rapidly in value.

Accepted Answer

A) True 
 B)False

Question 9

Compared to a company issuing stock, a company issuing bonds ________.

Accepted Answer

A) has a more concentrated ownership 
B) doesn't need to deal with financial institutions 
C) doesn't need to deal with the Securities and Exchange Commission 
D) need not publish information about its finances 
A) has a more concentrated ownership 
B) doesn't need to deal with financial institutions 
C) doesn't need to deal with the Securities and Exchange Commission 
D) need not publish information about its finances

Question 10

Money market funds ________.

Accepted Answer

A) are backed by the FDIC 
B) are similar to corporate bonds 
C) are very liquid 
D) are risky investments 
A) are backed by the FDIC 
B) are similar to corporate bonds 
C) are very liquid 
D) are risky investments

Question 11

Which of the following is NOT an advantage preferred stockholders have compared to common stockholders?

Accepted Answer

A) no chance of receiving voting privileges 
B) greater likelihood of being paid dividends 
C) greater chance of getting money back if the company fails 
D) preferred position in getting company assets if the company fails 
A) no chance of receiving voting privileges 
B) greater likelihood of being paid dividends 
C) greater chance of getting money back if the company fails 
D) preferred position in getting company assets if the company fails

Question 12

Stock dividends ________.

Accepted Answer

A) are typically paid from company profits 
B) are most likely to be paid by small startup companies 
C) are usually paid with more shares of stock, not cash 
D) must be paid by all companies that issue stock 
A) are typically paid from company profits 
B) are most likely to be paid by small startup companies 
C) are usually paid with more shares of stock, not cash 
D) must be paid by all companies that issue stock

What are the main factors that must be considered before a company decides to raise money through issuing bonds? Why are they important?

A bear market occurs when stocks have bottomed out and investor confidence is shifting from negative to positive.

Which of the following bonds has the shortest maturity date?

An investor with a strong appetite for risk should purchase a(n)________.

A bear market is distinguished by ________.

An asset allocation of 95% stocks and 5% bonds is considered ________ risk.

A(n)________ stock is issued by a company that has a long history of consistent growth and stability and often pays regular dividends.

A "sinking fund" is a corporate bond that is declining rapidly in value.

Compared to a company issuing stock, a company issuing bonds ________.

Money market funds ________.

Which of the following is NOT an advantage preferred stockholders have compared to common stockholders?

Stock dividends ________.

Business in the United States

Economics and Banking

Ethics and Social Responsibility

Business in a Global Economy

Entrepreneurs and Small Businesses

Forms of Business Ownership

Functions and Skills of Management

Motivation, Leadership, and Teamwork

Human Resources and Labor Relations

Business Technology: Management Information Systems

Production and Operations Management

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Mini E-Commerce

Mini Constructing a Successful Business Plan

Mini Business Communications

Mini Finding Employment

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Exam 16: Securities and Investments

What are the main factors that must be considered before a company decides to raise money through issuing bonds? Why are they important?

A bear market occurs when stocks have bottomed out and investor confidence is shifting from negative to positive.

Which of the following bonds has the shortest maturity date?

An investor with a strong appetite for risk should purchase a(n)________.

A bear market is distinguished by ________.

An asset allocation of 95% stocks and 5% bonds is considered ________ risk.

A(n)________ stock is issued by a company that has a long history of consistent growth and stability and often pays regular dividends.

A "sinking fund" is a corporate bond that is declining rapidly in value.

Compared to a company issuing stock, a company issuing bonds ________.

Money market funds ________.

Which of the following is NOT an advantage preferred stockholders have compared to common stockholders?

Stock dividends ________.

Business in the United States

Economics and Banking

Ethics and Social Responsibility

Business in a Global Economy

Entrepreneurs and Small Businesses

Forms of Business Ownership

Functions and Skills of Management

Motivation, Leadership, and Teamwork

Human Resources and Labor Relations

Business Technology: Management Information Systems

Production and Operations Management

Marketing and Consumer Behavior

Product Development and Pricing Strategies

Promotion and Distribution

Financing and Tracking Business Operations

Mini E-Commerce

Mini Constructing a Successful Business Plan

Mini Business Communications

Mini Finding Employment

Mini Personal Finance

Filters