Question 1

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

Accepted Answer

A)  balanced fund. 
B)  money market mutual fund. 
C)  exchange-traded fund (ETF). 
D)  index fund. 
E)  capital fund. 
A)  balanced fund. 
B)  money market mutual fund. 
C)  exchange-traded fund (ETF). 
D)  index fund. 
E)  capital fund.

Question 2

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 fund that invests in both foreign and U.S. securities would be known as [ an international | a global ] fund.

Accepted Answer

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

Question 3

Value funds typically invest in stocks that do not pay dividends and have high price/earnings (P/E) ratios.

Accepted Answer

A) True 
 B)False

Question 4

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 5

A technology fund is an example of a sector fund.

Accepted Answer

A) True 
 B)False

Question 6

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. 
Calculating the value of income-producing property requires estimating the [ net asset value (NAV) | net operating income ( NOI) ].

Accepted Answer

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

Question 7

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 size of the management fee is usually [ related | unrelated ] to the fund's performance.

Accepted Answer

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

Question 8

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

Accepted Answer

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

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. 
First-time real estate investors often purchase [ commercial | residential ] properties.

Accepted Answer

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

Question 10

By using an automatic reinvestment plan, dividend and capital gains income is used to automatically buy additional shares in the fund.

Accepted Answer

A) True 
 B)False

Question 11

RACE Mutual fund is a no-load fund that had a net asset value (NAV) of $25.60 1 year ago. Today, the NAV is $28.83. During the year, dividends of $0.72 were paid out, and a capital gain distribution of $0.65 was made. Calculate the approximate yield for RACE. (Show all work.)

Accepted Answer

Approximate Yield = {Dividends and Capit

Question 12

Growth funds are mutual funds designed for short-term investing.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following statements about balanced funds is true?

Accepted Answer

A)  Balanced funds are most suitable for investors who can tolerate risk and price volatility. 
B)  Balanced funds put most of their money into equities. 
C)  Balanced funds are viewed by many high-income investors as a type of tax-sheltered investment. 
D)  Balanced funds generally keep 30% to 40% of their portfolios in bonds. 
E)  Balanced funds look for stocks with relatively low price/earnings (P/
E)  ratios, high dividend yields, and moderate amounts of financial leverage. 
A)  Balanced funds are most suitable for investors who can tolerate risk and price volatility. 
B)  Balanced funds put most of their money into equities. 
C)  Balanced funds are viewed by many high-income investors as a type of tax-sheltered investment. 
D)  Balanced funds generally keep 30% to 40% of their portfolios in bonds. 
E)  Balanced funds look for stocks with relatively low price/earnings (P/
E)  ratios, high dividend yields, and moderate amounts of financial leverage.

Question 14

A real estate investment trust (REIT) 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 15

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 would not trade among themselves in [ a closed-end | an open-end ] investment company.

Accepted Answer

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

Question 16

The current market value of all the securities a mutual fund owns, less any liabilities, on a per-share basis is known as the fund's:

Accepted Answer

A)  compounded value. 
B)  par value. 
C)  net asset value (NAV). 
D)  book value. 
E)  liquidation value. 
A)  compounded value. 
B)  par value. 
C)  net asset value (NAV). 
D)  book value. 
E)  liquidation value.

Question 17

_____ gives the property owner an allowance for the decline in the physical condition of real estate over time.

Accepted Answer

A)  Depreciation 
B)  A capital gain 
C)  A dividend 
D)  Interest 
E)  Leverage 
A)  Depreciation 
B)  A capital gain 
C)  A dividend 
D)  Interest 
E)  Leverage

Question 18

Compared to mutual funds, exchange-traded funds (ETFs):

Accepted Answer

A)  are more cost-effective for investors with a short-term horizon. 
B)  generate higher taxable gains. 
C)  accommodate investors pursuing narrow market segments. 
D)  are more diversified. 
E)  have higher overhead expenses. 
A)  are more cost-effective for investors with a short-term horizon. 
B)  generate higher taxable gains. 
C)  accommodate investors pursuing narrow market segments. 
D)  are more diversified. 
E)  have higher overhead expenses.

Question 19

Index funds have high realized capital gains.

Accepted Answer

A) True 
 B)False

Question 20

A mutual fund prospectus is required to fully disclose all fund fees and expenses.

Accepted Answer

A) True 
 B)False

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

Value funds typically invest in stocks that do not pay dividends and have high price/earnings (P/E) ratios.

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

A technology fund is an example of a sector fund.

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 size of the management fee is usually [ related | unrelated ] to the fund's performance.

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

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. First-time real estate investors often purchase [ commercial | residential ] properties.

By using an automatic reinvestment plan, dividend and capital gains income is used to automatically buy additional shares in the fund.

RACE Mutual fund is a no-load fund that had a net asset value (NAV) of $25.60 1 year ago. Today, the NAV is $28.83. During the year, dividends of $0.72 were paid out, and a capital gain distribution of $0.65 was made. Calculate the approximate yield for RACE. (Show all work.)

Growth funds are mutual funds designed for short-term investing.

Which of the following statements about balanced funds is true?

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

The current market value of all the securities a mutual fund owns, less any liabilities, on a per-share basis is known as the fund's:

_____ gives the property owner an allowance for the decline in the physical condition of real estate over time.

Compared to mutual funds, exchange-traded funds (ETFs):

Index funds have high realized capital gains.

A mutual fund prospectus is required to fully disclose all fund fees and expenses.

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

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters

Exam 13: Investing in Mutual Funds and Real Estate

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

Value funds typically invest in stocks that do not pay dividends and have high price/earnings (P/E) ratios.

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

A technology fund is an example of a sector fund.

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 size of the management fee is usually [ related | unrelated ] to the fund's performance.

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

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. First-time real estate investors often purchase [ commercial | residential ] properties.

By using an automatic reinvestment plan, dividend and capital gains income is used to automatically buy additional shares in the fund.

RACE Mutual fund is a no-load fund that had a net asset value (NAV) of $25.60 1 year ago. Today, the NAV is $28.83. During the year, dividends of $0.72 were paid out, and a capital gain distribution of $0.65 was made. Calculate the approximate yield for RACE. (Show all work.)

Growth funds are mutual funds designed for short-term investing.

Which of the following statements about balanced funds is true?

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

The current market value of all the securities a mutual fund owns, less any liabilities, on a per-share basis is known as the fund's:

_____ gives the property owner an allowance for the decline in the physical condition of real estate over time.

Compared to mutual funds, exchange-traded funds (ETFs):

Index funds have high realized capital gains.

A mutual fund prospectus is required to fully disclose all fund fees and expenses.

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

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters