Question 1

_____ funds are highly speculative investments that seek large profits from capital gains.

Accepted Answer

A) Balanced 
B) Growth 
C) Equity income 
D) Aggressive growth 
E) Exchange traded 
A) Balanced 
B) Growth 
C) Equity income 
D) Aggressive growth 
E) Exchange traded D

Question 2

All mutual funds always charge a:

Accepted Answer

A) transaction fee. 
B) 12b-1 fee. 
C) management fee. 
D) fee on the sale of the shares. 
E) redemption fee. 
A) transaction fee. 
B) 12b-1 fee. 
C) management fee. 
D) fee on the sale of the shares. 
E) redemption fee. C

Question 3

An investor with a small amount of money should stick to using load funds instead of no-load funds.

Accepted Answer

A) True 
 B)False  False

Question 4

_____ funds are balanced funds that automatically change the asset allocation from more to less equity exposure as an investor ages.

Accepted Answer

A) Bond 
B) Aggressive growth 
C) Value 
D) Target-date 
E) Intermediate-term 
A) Bond 
B) Aggressive growth 
C) Value 
D) Target-date 
E) Intermediate-term

Question 5

Which of the following real estate investment trusts (REITs)is the most attractive to income-oriented investors?

Accepted Answer

A) Equity 
B) Mortgage 
C) Back-end load 
D) Unit trust 
E) Exchange traded 
A) Equity 
B) Mortgage 
C) Back-end load 
D) Unit trust 
E) Exchange traded

Question 6

The actual ownership of a mutual fund is in the hands of the:

Accepted Answer

A) management company. 
B) custodians. 
C) shareholders. 
D) distributors. 
E) money manager. 
A) management company. 
B) custodians. 
C) shareholders. 
D) distributors. 
E) money manager.

Question 7

Tom takes a loan of $60,000 at 4% annual interest to purchase a property worth $100,000. He earns an annual income of $10,000 after expenses but before interest and income taxes are deducted. If the income tax rate is 30%, then the leveraged return on the real estate investment is:

Accepted Answer

A) 30%. 
B) 25%. 
C) 10%. 
D) 19%. 
E) 13%. 
A) 30%. 
B) 25%. 
C) 10%. 
D) 19%. 
E) 13%.

Question 8

The idea of a mutual fund is based on the idea of pooled diversification.

Accepted Answer

A) True 
 B)False

Question 9

Mutual funds and exchange traded funds (ETFs)provide professional investment management.

Accepted Answer

A) True 
 B)False

Question 10

A fund that invests in only one or more industries that are associated with each other is a _____ fund.

Accepted Answer

A) money market 
B) maximum capital 
C) sector 
D) balanced 
E) bond 
A) money market 
B) maximum capital 
C) sector 
D) balanced 
E) bond

Question 11

A fund that is structured to match the performance of a certain market segment is known as a(n)_____ fund.

Accepted Answer

A) balanced 
B) preferred stock 
C) exchange traded 
D) index 
E) capital 
A) balanced 
B) preferred stock 
C) exchange traded 
D) index 
E) capital

Question 12

Which of the following statements regarding real estate investments is true?

Accepted Answer

A) Real estate investments move in tandem with stocks. 
B) Adding  real estate to your stock portfolio increases investment diversity. 
C) Real estate is an asset with high liquidity. 
D) Real estate investments have less scope for financial leverage. 
E) Real estate investments cannot depreciate. 
A) Real estate investments move in tandem with stocks. 
B) Adding  real estate to your stock portfolio increases investment diversity. 
C) Real estate is an asset with high liquidity. 
D) Real estate investments have less scope for financial leverage. 
E) Real estate investments cannot depreciate.

Question 13

In the online quotes from The Wall Street Journal 's listing of mutual funds, an "r" after the mutual fund name means that particular mutual fund has a _____ associated with it.

Accepted Answer

A) front-end load 
B) back-end load 
C) 12b-1 fee 
D) management fee 
E) distribution load 
A) front-end load 
B) back-end load 
C) 12b-1 fee 
D) management fee 
E) distribution load

Question 14

A(n)_____ oversees a mutual fund's portfolio and makes the buy and sell decisions.

Accepted Answer

A) transfer agent 
B) distributor 
C) investment advisor 
D) regulator 
E) custodian 
A) transfer agent 
B) distributor 
C) investment advisor 
D) regulator 
E) custodian

Question 15

If you are a mutual fund investor who needs a steady income, you might take advantage of a fund's:

Accepted Answer

A) retirement plans. 
B) exchange privileges. 
C) automatic reinvestment plans. 
D) systematic withdrawal plans. 
E) conversion plans. 
A) retirement plans. 
B) exchange privileges. 
C) automatic reinvestment plans. 
D) systematic withdrawal plans. 
E) conversion plans.

Question 16

A real estate investment trust that invests in various types of income-producing properties and mortgage loans is a:

Accepted Answer

A) hybrid REIT. 
B) blind pool REIT. 
C) real estate REIT. 
D) hybrid limited REIT. 
E) mortgage REIT. 
A) hybrid REIT. 
B) blind pool REIT. 
C) real estate REIT. 
D) hybrid limited REIT. 
E) mortgage REIT.

Question 17

Investment in real estate is attractive to investors because:

Accepted Answer

A) it is a highly liquid investment. 
B) it permits a high degree of financial leverage. 
C) it is exempted from taxation. 
D) it requires very low investment. 
E) it is highly correlated with the stock markets. 
A) it is a highly liquid investment. 
B) it permits a high degree of financial leverage. 
C) it is exempted from taxation. 
D) it requires very low investment. 
E) it is highly correlated with the stock markets.

Question 18

Mutual funds typically offer more diversification and less risk than purchasing one or two individual securities.

Accepted Answer

A) True 
 B)False

Question 19

Carlos holds a portfolio of stocks and bonds. He is planning to buy a real estate property worth $150,000. He can use financial leverage to make this purchase by:

Accepted Answer

A) paying $75,000 cash in the first installment and selling shares worth $75,000 from his portfolio to pay the second installment. 
B) taking a personal loan worth $100,000 and selling bonds worth $50,000 from his portfolio. 
C) selling bonds from his portfolio worth $80,000 and writing a check for $70,000. 
D) selling stocks from his portfolio worth $50,000 and paying $100,000 in cash. 
E) paying $150,000 in cash from his savings account. 
A) paying $75,000 cash in the first installment and selling shares worth $75,000 from his portfolio to pay the second installment. 
B) taking a personal loan worth $100,000 and selling bonds worth $50,000 from his portfolio. 
C) selling bonds from his portfolio worth $80,000 and writing a check for $70,000. 
D) selling stocks from his portfolio worth $50,000 and paying $100,000 in cash. 
E) paying $150,000 in cash from his savings account.

Question 20

Redeeming your back-end load mutual fund shares might result in a charge called the:

Accepted Answer

A) redemption fee. 
B) usage fee. 
C) management fee. 
D) recordkeeping fee. 
E) 12b-1 fee. 
A) redemption fee. 
B) usage fee. 
C) management fee. 
D) recordkeeping fee. 
E) 12b-1 fee.

_____ funds are highly speculative investments that seek large profits from capital gains.

All mutual funds always charge a:

An investor with a small amount of money should stick to using load funds instead of no-load funds.

_____ funds are balanced funds that automatically change the asset allocation from more to less equity exposure as an investor ages.

Which of the following real estate investment trusts (REITs)is the most attractive to income-oriented investors?

The actual ownership of a mutual fund is in the hands of the:

Tom takes a loan of $60,000 at 4% annual interest to purchase a property worth $100,000. He earns an annual income of $10,000 after expenses but before interest and income taxes are deducted. If the income tax rate is 30%, then the leveraged return on the real estate investment is:

The idea of a mutual fund is based on the idea of pooled diversification.

Mutual funds and exchange traded funds (ETFs)provide professional investment management.

A fund that invests in only one or more industries that are associated with each other is a _____ fund.

A fund that is structured to match the performance of a certain market segment is known as a(n)_____ fund.

Which of the following statements regarding real estate investments is true?

In the online quotes from The Wall Street Journal 's listing of mutual funds, an "r" after the mutual fund name means that particular mutual fund has a _____ associated with it.

A(n)_____ oversees a mutual fund's portfolio and makes the buy and sell decisions.

If you are a mutual fund investor who needs a steady income, you might take advantage of a fund's:

A real estate investment trust that invests in various types of income-producing properties and mortgage loans is a:

Investment in real estate is attractive to investors because:

Mutual funds typically offer more diversification and less risk than purchasing one or two individual securities.

Carlos holds a portfolio of stocks and bonds. He is planning to buy a real estate property worth $150,000. He can use financial leverage to make this purchase by:

Redeeming your back-end load mutual fund shares might result in a charge called the:

Understanding the Financial Process

Using Financial Statements and Budgets

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 Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters

Exam 13: Investing in Mutual Funds, Etfs, and Real Estate

_____ funds are highly speculative investments that seek large profits from capital gains.

All mutual funds always charge a:

An investor with a small amount of money should stick to using load funds instead of no-load funds.

_____ funds are balanced funds that automatically change the asset allocation from more to less equity exposure as an investor ages.

Which of the following real estate investment trusts (REITs)is the most attractive to income-oriented investors?

The actual ownership of a mutual fund is in the hands of the:

Tom takes a loan of $60,000 at 4% annual interest to purchase a property worth $100,000. He earns an annual income of $10,000 after expenses but before interest and income taxes are deducted. If the income tax rate is 30%, then the leveraged return on the real estate investment is:

The idea of a mutual fund is based on the idea of pooled diversification.

Mutual funds and exchange traded funds (ETFs)provide professional investment management.

A fund that invests in only one or more industries that are associated with each other is a _____ fund.

A fund that is structured to match the performance of a certain market segment is known as a(n)_____ fund.

Which of the following statements regarding real estate investments is true?

In the online quotes from The Wall Street Journal 's listing of mutual funds, an "r" after the mutual fund name means that particular mutual fund has a _____ associated with it.

A(n)_____ oversees a mutual fund's portfolio and makes the buy and sell decisions.

If you are a mutual fund investor who needs a steady income, you might take advantage of a fund's:

A real estate investment trust that invests in various types of income-producing properties and mortgage loans is a:

Investment in real estate is attractive to investors because:

Mutual funds typically offer more diversification and less risk than purchasing one or two individual securities.

Carlos holds a portfolio of stocks and bonds. He is planning to buy a real estate property worth $150,000. He can use financial leverage to make this purchase by:

Redeeming your back-end load mutual fund shares might result in a charge called the:

Understanding the Financial Process

Using Financial Statements and Budgets

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 Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters