Question 1

The over-the-counter (OTC) market is a primary market.

Accepted Answer

A) True 
 B)False  False

Question 2

Which of the following statements regarding bonds is true?

Accepted Answer

A)  Bonds are liabilities of the issuer. 
B)  Individuals investing in bonds receive dividends. 
C)  Bonds cannot be purchased or sold prior to maturity. 
D)  Income from bonds varies every year. 
E)  The principal invested in bonds is not returned at the time of maturity. 
A)  Bonds are liabilities of the issuer. 
B)  Individuals investing in bonds receive dividends. 
C)  Bonds cannot be purchased or sold prior to maturity. 
D)  Income from bonds varies every year. 
E)  The principal invested in bonds is not returned at the time of maturity. A

Question 3

Which of the following securities laws regulates the sale of mutual fund shares?

Accepted Answer

A)  The Securities Act of 1933 
B)  The Securities and Exchange Act of 1934 
C)  The Investment Company Act of 1940 
D)  The Sarbanes-Oxley Act of 2002 
E)  The Securities Investor Protection Act of 1970 
A)  The Securities Act of 1933 
B)  The Securities and Exchange Act of 1934 
C)  The Investment Company Act of 1940 
D)  The Sarbanes-Oxley Act of 2002 
E)  The Securities Investor Protection Act of 1970 C

Question 4

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 a brokerage agreement contains a binding arbitration clause, you [ can  | cannot ] go to court to appeal your malpractice case against the broker.

Accepted Answer

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

Question 5

Which of the following individuals would a portfolio containing 80 to 90% in common stocks be appropriate for?

Accepted Answer

A)  John and Vanessa, a retired couple in their mid-60s 
B)  Michelle, a divorced middle-aged mother who has custody of her children, ages 2 and 6, and earns $60,000 a year in salary 
C)  Meredith and Joe, a blue-collar, two-income family with 2 children, both of whom will be starting college within the next 3 years 
D)  Ryan and Ramona, newlyweds who are in their mid-20s, have steady jobs, and are putting money aside for retirement 
E)  Antonio and Lora, a couple in their mid-50s who earn a combined $150,000 in salary and are planning to retire in 10 years 
A)  John and Vanessa, a retired couple in their mid-60s 
B)  Michelle, a divorced middle-aged mother who has custody of her children, ages 2 and 6, and earns $60,000 a year in salary 
C)  Meredith and Joe, a blue-collar, two-income family with 2 children, both of whom will be starting college within the next 3 years 
D)  Ryan and Ramona, newlyweds who are in their mid-20s, have steady jobs, and are putting money aside for retirement 
E)  Antonio and Lora, a couple in their mid-50s who earn a combined $150,000 in salary and are planning to retire in 10 years

Question 6

James purchased five bonds with a face value of $1,000 that paid a 5% annual interest rate. James's total annual interest income for each year is:

Accepted Answer

A)  $50. 
B)  $175. 
C)  $250. 
D)  $100. 
E)  $500. 
A)  $50. 
B)  $175. 
C)  $250. 
D)  $100. 
E)  $500.

Question 7

Securities Investor Protection Corporation (SIPC) insurance guarantees the dollar value of your securities will not dip below a certain level.

Accepted Answer

A) True 
 B)False

Question 8

The _____ requires investment companies to register with the Securities and Exchange Commission (SEC) and to fulfill certain disclosure requirements.

Accepted Answer

A)  Investment Company Act of 1940 
B)  Securities Exchange Act of 1934 
C)  Securities Investor Protection Act of 1970 
D)  Sarbanes-Oxley Act of 2002 
E)  Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 
A)  Investment Company Act of 1940 
B)  Securities Exchange Act of 1934 
C)  Securities Investor Protection Act of 1970 
D)  Sarbanes-Oxley Act of 2002 
E)  Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010

Question 9

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 discount broker will execute orders and [ pick the stocks for you to buy | offer little to no other services ].

Accepted Answer

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

Question 10

Clara's portfolio is worth $200,000, and her portfolio consists of common stocks worth $56,000. Therefore, equity constitutes _____ of Clara's portfolio.

Accepted Answer

A)  10% 
B)  33% 
C)  28% 
D)  56% 
E)  61% 
A)  10% 
B)  33% 
C)  28% 
D)  56% 
E)  61%

Question 11

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 use of margin will magnify [ only profits | only losses ].

Accepted Answer

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

Question 12

A market order is transacted at the:

Accepted Answer

A)  lowest price of the day. 
B)  best price when the order is entered. 
C)  limit price. 
D)  price quoted by the broker. 
E)  average price of the stock on the transaction day. 
A)  lowest price of the day. 
B)  best price when the order is entered. 
C)  limit price. 
D)  price quoted by the broker. 
E)  average price of the stock on the transaction day.

Question 13

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 [ Dow Jones Industrial Average ( DJIA) | Standard & Poor's ( S&P) composite index ] is based on 500 different stocks.

Accepted Answer

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

Question 14

When completed, an investment plan is a way of translating an abstract investment target into a specific investment program.

Accepted Answer

A) True 
 B)False

Question 15

Which of the following characteristics of an investor should be evaluated in order to formulate an effective portfolio strategy?

Accepted Answer

A)  Level of educational attainment 
B)  Interest in specific activities 
C)  Level and stability of income 
D)  Level of Internet skills 
E)  Judgment skills to buy and sell securities 
A)  Level of educational attainment 
B)  Interest in specific activities 
C)  Level and stability of income 
D)  Level of Internet skills 
E)  Judgment skills to buy and sell securities

Question 16

Online calculators and worksheets can help you find answers to financial planning and investing questions.

Accepted Answer

A) True 
 B)False

Question 17

A collection of securities assembled to meet common investment goals is called a(n):

Accepted Answer

A)  treasury. 
B)  diversification. 
C)  grouping. 
D)  envelope. 
E)  portfolio. 
A)  treasury. 
B)  diversification. 
C)  grouping. 
D)  envelope. 
E)  portfolio.

Question 18

INSTRUCTIONS: Choose the word or phrase in [ ] that 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. 
Short-term securities are traded in the [ money | capital ] market.

Accepted Answer

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

Question 19

Which of the following is an example of a hybrid security?

Accepted Answer

A)  Mutual fund 
B)  Convertible security 
C)  Exchange-traded fund (ETF) 
D)  Exchange-traded note (ETN) 
E)  Real estate 
A)  Mutual fund 
B)  Convertible security 
C)  Exchange-traded fund (ETF) 
D)  Exchange-traded note (ETN) 
E)  Real estate

Question 20

The Dow Jones Industrial Average (DJIA) is based on:

Accepted Answer

A)  50 stocks. 
B)  30 stocks. 
C)  500 stocks. 
D)  200 stocks. 
E)  100 stocks. 
A)  50 stocks. 
B)  30 stocks. 
C)  500 stocks. 
D)  200 stocks. 
E)  100 stocks.

The over-the-counter (OTC) market is a primary market.

Which of the following statements regarding bonds is true?

Which of the following securities laws regulates the sale of mutual fund shares?

Which of the following individuals would a portfolio containing 80 to 90% in common stocks be appropriate for?

James purchased five bonds with a face value of $1,000 that paid a 5% annual interest rate. James's total annual interest income for each year is:

Securities Investor Protection Corporation (SIPC) insurance guarantees the dollar value of your securities will not dip below a certain level.

The _____ requires investment companies to register with the Securities and Exchange Commission (SEC) and to fulfill certain disclosure requirements.

Clara's portfolio is worth $200,000, and her portfolio consists of common stocks worth $56,000. Therefore, equity constitutes _____ of Clara's portfolio.

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 use of margin will magnify [ only profits | only losses ].

A market order is transacted at the:

When completed, an investment plan is a way of translating an abstract investment target into a specific investment program.

Which of the following characteristics of an investor should be evaluated in order to formulate an effective portfolio strategy?

Online calculators and worksheets can help you find answers to financial planning and investing questions.

A collection of securities assembled to meet common investment goals is called a(n):

INSTRUCTIONS: Choose the word or phrase in [ ] that 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. Short-term securities are traded in the [ money | capital ] market.

Which of the following is an example of a hybrid security?

The Dow Jones Industrial Average (DJIA) is based on:

Understanding the Financial Planning Process

Developing 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

Investing in Stocks and Bonds

Investing in Mutual Funds and Real Estate

Planning for Retirement

Preserving Your Estate

Filters

Exam 11: Investment Planning

The over-the-counter (OTC) market is a primary market.

Which of the following statements regarding bonds is true?

Which of the following securities laws regulates the sale of mutual fund shares?

Which of the following individuals would a portfolio containing 80 to 90% in common stocks be appropriate for?

James purchased five bonds with a face value of $1,000 that paid a 5% annual interest rate. James's total annual interest income for each year is:

Securities Investor Protection Corporation (SIPC) insurance guarantees the dollar value of your securities will not dip below a certain level.

The _____ requires investment companies to register with the Securities and Exchange Commission (SEC) and to fulfill certain disclosure requirements.

Clara's portfolio is worth $200,000, and her portfolio consists of common stocks worth $56,000. Therefore, equity constitutes _____ of Clara's portfolio.

INSTRUCTIONS: Choose the word or phrase in [ ] that 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 use of margin will magnify [ only profits | only losses ].

A market order is transacted at the:

When completed, an investment plan is a way of translating an abstract investment target into a specific investment program.

Which of the following characteristics of an investor should be evaluated in order to formulate an effective portfolio strategy?

Online calculators and worksheets can help you find answers to financial planning and investing questions.

A collection of securities assembled to meet common investment goals is called a(n):

INSTRUCTIONS: Choose the word or phrase in [ ] that 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. Short-term securities are traded in the [ money | capital ] market.

Which of the following is an example of a hybrid security?

The Dow Jones Industrial Average (DJIA) is based on:

Understanding the Financial Planning Process

Developing 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

Investing in Stocks and Bonds

Investing in Mutual Funds and Real Estate

Planning for Retirement

Preserving Your Estate

Filters