Question 1

You have just purchased shares of stock from a stockbroker.These shares were previously traded on the NYSE.This trade took place in the

Accepted Answer

A)  primary market. 
B)  secondary market. 
C)  tertiary market. 
D)  quaternary market. 
E)  none of the above. 
A)  primary market. 
B)  secondary market. 
C)  tertiary market. 
D)  quaternary market. 
E)  none of the above.

Question 2

If you purchase some shares of stock

Accepted Answer

A)  you may earn dividends. 
B)  you will definitely earn dividends. 
C)  you may earn coupon interest. 
D)  you will definitely earn coupon interest. 
A)  you may earn dividends. 
B)  you will definitely earn dividends. 
C)  you may earn coupon interest. 
D)  you will definitely earn coupon interest.

Question 3

If you bought a 20-year bond issued by the government,with a par value of $1,000 and an interest rate of 8%.At maturity you will be returned the principal of

Accepted Answer

A)  $80. 
B)  $500. 
C)  $800. 
D)  $1,000. 
E)  $1,600. 
A)  $80. 
B)  $500. 
C)  $800. 
D)  $1,000. 
E)  $1,600.

Question 4

The risk associated with the use of debt by the firm is business risk.

Accepted Answer

A) True 
 B)False

Question 5

Securities include both ________ and ________.

Accepted Answer

A)  stocks; mutual funds 
B)  bonds; mutual funds 
C)  real estate; stocks 
D)  stocks; bonds 
E)  bonds; money market funds 
A)  stocks; mutual funds 
B)  bonds; mutual funds 
C)  real estate; stocks 
D)  stocks; bonds 
E)  bonds; money market funds

Question 6

The difference between an organized exchange and an over-the-counter market is that the transactions that occur on an organized exchange ________ and the over-the-counter transactions ________.

Accepted Answer

A)  are initial offerings; are seasoned issues 
B)  are seasoned issues; are initial offerings 
C)  take place in a physical building; are conducted over the phone or via a computer 
D)  are conducted over the phone or via a computer; take place in a physical building 
E)  are initial offerings; are conducted over the phone 
A)  are initial offerings; are seasoned issues 
B)  are seasoned issues; are initial offerings 
C)  take place in a physical building; are conducted over the phone or via a computer 
D)  are conducted over the phone or via a computer; take place in a physical building 
E)  are initial offerings; are conducted over the phone

Question 7

A ________ is a member of an exchange who oversees the trading in one or more stocks and is generally responsible for maintaining a "fair and orderly" market in those stocks by purchasing or releasing stocks into the market.

Accepted Answer

A)  floor trader 
B)  day trader 
C)  specialist 
D)  monitor 
E)  none of the above 
A)  floor trader 
B)  day trader 
C)  specialist 
D)  monitor 
E)  none of the above

Question 8

Investors who trade with a very short time horizon,generally holding onto stocks for only a few hours,are called

Accepted Answer

A)  day traders. 
B)  movement traders. 
C)  hedge traders. 
D)  deep discount traders. 
E)  none of the above. 
A)  day traders. 
B)  movement traders. 
C)  hedge traders. 
D)  deep discount traders. 
E)  none of the above.

Question 9

The NASDAQ is the largest electronic stock exchange.

Accepted Answer

A) True 
 B)False

Question 10

A typical young investor should have most of their retirement money allocated in common stocks.

Accepted Answer

A) True 
 B)False

Question 11

A(n)________ advertisement provides a listing of the underwriting syndicate involved in a new offering.

Accepted Answer

A)  prospectus 
B)  underwriting notification 
C)  brokerage notification 
D)  tombstone 
E)  none of the above 
A)  prospectus 
B)  underwriting notification 
C)  brokerage notification 
D)  tombstone 
E)  none of the above

Question 12

Gracie Johnson saw the securities announcement for New York Bagel Enterprises that provided the details of the offering and a listing of the underwriting syndicate.She saw the

Accepted Answer

A)  tombstone advertisement. 
B)  prospectus. 
C)  initial post. 
D)  exchange advertisement. 
E)  underwriter's issue. 
A)  tombstone advertisement. 
B)  prospectus. 
C)  initial post. 
D)  exchange advertisement. 
E)  underwriter's issue.

Question 13

All of the following are true about the American Stock Exchange except

Accepted Answer

A)  it is the second most important of the organized exchanges. 
B)  it is one of the secondary markets. 
C)  its trading volume is a small fraction of that of the NYSE. 
D)  its dollar volume is larger than all the regional exchanges. 
E)  it ranks as number two in terms of the number of companies it lists. 
A)  it is the second most important of the organized exchanges. 
B)  it is one of the secondary markets. 
C)  its trading volume is a small fraction of that of the NYSE. 
D)  its dollar volume is larger than all the regional exchanges. 
E)  it ranks as number two in terms of the number of companies it lists.

Question 14

List some helpful investment tips.

Accepted Answer

Systems don't beat the market.It's long-

Question 15

You have been watching a stock that has dramatically increased in price for the last several days.Today it closed at $50 per share.You want to purchase this stock in the morning using your online brokerage account.You are willing to pay up to $53 a share but no higher.What type of purchase order should you use?

Accepted Answer

A)  A stop-loss order 
B)  A good-til-cancel order 
C)  A market order 
D)  A limit order 
A)  A stop-loss order 
B)  A good-til-cancel order 
C)  A market order 
D)  A limit order

Question 16

Paula bought a stock for $200 last year and sold it today for $150.If she earned a dividend of $100 while she held the stock her rate of return was

Accepted Answer

A)  -50%. 
B)  -25%. 
C)  25%. 
D)  33.33%. 
E)  50%. 
A)  -50%. 
B)  -25%. 
C)  25%. 
D)  33.33%. 
E)  50%.

Question 17

Changes in the capital gains tax rate,or in the tax deductibility on municipal bonds are examples of ________ risk.

Accepted Answer

A)  inflation 
B)  political and regulatory 
C)  interest rate 
D)  exchange rate risk 
E)  none of the above 
A)  inflation 
B)  political and regulatory 
C)  interest rate 
D)  exchange rate risk 
E)  none of the above

Question 18

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

Accepted Answer

A)  FDIC 
B)  FSLIC 
C)  NCUA 
D)  SIPC 
E)  FTC 
A)  FDIC 
B)  FSLIC 
C)  NCUA 
D)  SIPC 
E)  FTC

Question 19

Which of the following is not risk that can be diversified out of a portfolio of stocks?

Accepted Answer

A)  unsystematic 
B)  systematic 
C)  firm specific 
D)  company-unique 
A)  unsystematic 
B)  systematic 
C)  firm specific 
D)  company-unique

Question 20

If you're going to make informed investment decisions,you have to seek investment information,read it,and interpret it.

Accepted Answer

A) True 
 B)False

You have just purchased shares of stock from a stockbroker.These shares were previously traded on the NYSE.This trade took place in the

If you purchase some shares of stock

If you bought a 20-year bond issued by the government,with a par value of $1,000 and an interest rate of 8%.At maturity you will be returned the principal of

The risk associated with the use of debt by the firm is business risk.

Securities include both and .

The difference between an organized exchange and an over-the-counter market is that the transactions that occur on an organized exchange and the over-the-counter transactions .

A ________ is a member of an exchange who oversees the trading in one or more stocks and is generally responsible for maintaining a "fair and orderly" market in those stocks by purchasing or releasing stocks into the market.

Investors who trade with a very short time horizon,generally holding onto stocks for only a few hours,are called

The NASDAQ is the largest electronic stock exchange.

A typical young investor should have most of their retirement money allocated in common stocks.

A(n)________ advertisement provides a listing of the underwriting syndicate involved in a new offering.

Gracie Johnson saw the securities announcement for New York Bagel Enterprises that provided the details of the offering and a listing of the underwriting syndicate.She saw the

All of the following are true about the American Stock Exchange except

List some helpful investment tips.

Paula bought a stock for $200 last year and sold it today for $150.If she earned a dividend of $100 while she held the stock her rate of return was

Changes in the capital gains tax rate,or in the tax deductibility on municipal bonds are examples of ________ risk.

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

Which of the following is not risk that can be diversified out of a portfolio of stocks?

If you're going to make informed investment decisions,you have to seek investment information,read it,and interpret it.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Student and Consumer Loans: The Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: An Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters

Exam 11: Investment Basics

You have just purchased shares of stock from a stockbroker.These shares were previously traded on the NYSE.This trade took place in the

If you purchase some shares of stock

If you bought a 20-year bond issued by the government,with a par value of $1,000 and an interest rate of 8%.At maturity you will be returned the principal of

The risk associated with the use of debt by the firm is business risk.

Securities include both ________ and ________.

The difference between an organized exchange and an over-the-counter market is that the transactions that occur on an organized exchange ________ and the over-the-counter transactions ________.

A ________ is a member of an exchange who oversees the trading in one or more stocks and is generally responsible for maintaining a "fair and orderly" market in those stocks by purchasing or releasing stocks into the market.

Investors who trade with a very short time horizon,generally holding onto stocks for only a few hours,are called

The NASDAQ is the largest electronic stock exchange.

A typical young investor should have most of their retirement money allocated in common stocks.

A(n)________ advertisement provides a listing of the underwriting syndicate involved in a new offering.

Gracie Johnson saw the securities announcement for New York Bagel Enterprises that provided the details of the offering and a listing of the underwriting syndicate.She saw the

All of the following are true about the American Stock Exchange except

List some helpful investment tips.

Paula bought a stock for $200 last year and sold it today for $150.If she earned a dividend of $100 while she held the stock her rate of return was

Changes in the capital gains tax rate,or in the tax deductibility on municipal bonds are examples of ________ risk.

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

Which of the following is not risk that can be diversified out of a portfolio of stocks?

If you're going to make informed investment decisions,you have to seek investment information,read it,and interpret it.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: The Role of Open Credit

Student and Consumer Loans: The Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: An Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Events Fitting the Pieces Together

Filters

Securities include both and .

The difference between an organized exchange and an over-the-counter market is that the transactions that occur on an organized exchange and the over-the-counter transactions .