Question 1

A specialist is a person on the floor of the exchange who handles trades of a particular stock in an effort to maintain a fair and orderly market.

Accepted Answer

A) True 
 B)False

Question 2

Anderson Equipment Corporation has total after-tax earnings of $915,000 and 400,000 shares of common stock outstanding.What are the earnings per share for Anderson Equipment?

Accepted Answer

A) $1.89 
B) $1.97 
C) $2.06 
D) $2.29 
A) $1.89 
B) $1.97 
C) $2.06 
D) $2.29

Question 3

The limited liability of common stockholders refers to their

Accepted Answer

A) losses being limited to their original amount that they invested. 
B) responsibility for any unpaid debts if the company goes bankrupt. 
C) rights to elect a board of directors but not the company management. 
D) lack of ownership of the retained earnings of the company. 
A) losses being limited to their original amount that they invested. 
B) responsibility for any unpaid debts if the company goes bankrupt. 
C) rights to elect a board of directors but not the company management. 
D) lack of ownership of the retained earnings of the company.

Question 4

____ typically have voting rights.

Accepted Answer

A) Bondholders 
B) Common stockholders 
C) Preferred stockholders 
D) Both common stockholders and preferred stockholders 
A) Bondholders 
B) Common stockholders 
C) Preferred stockholders 
D) Both common stockholders and preferred stockholders

Question 5

Value stocks often operate within industries that benefit from a slowing economy.

Accepted Answer

A) True 
 B)False

Question 6

Most trades are

Accepted Answer

A) market orders. 
B) limit orders. 
C) stop orders. 
D) None of these. 
A) market orders. 
B) limit orders. 
C) stop orders. 
D) None of these.

Question 7

The only public stock exchanges in the United States are the New York Stock Exchange and the American Stock Exchange.

Accepted Answer

A) True 
 B)False

Question 8

Discount brokers typically provide personal investment advice as well as executing trades.

Accepted Answer

A) True 
 B)False

Question 9

The default rate on high-quality bonds is slightly over 5 percent.

Accepted Answer

A) True 
 B)False

Question 10

Other factors being equal,____ bonds will offer the highest yields.

Accepted Answer

A) BBB. Treasury 
B) AAA-rated corporate 
C) AA-rated corporate 
D) A-rated corporate 
A) BBB. Treasury 
B) AAA-rated corporate 
C) AA-rated corporate 
D) A-rated corporate

Question 11

There is no cost for placing a stop order if the order is never executed.

Accepted Answer

A) True 
 B)False

Question 12

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year:
  
-What is Sudsy Soap's PEG ratio?

Accepted Answer

A) 3.5 
B) 35 
C) 4.375 
D) 0.435 
A) 3.5 
B) 35 
C) 4.375 
D) 0.435

Question 13

Another name for a stockbroker is

Accepted Answer

A) an account executive. 
B) a registered agent. 
C) a sales representative. 
D) All of these. 
A) an account executive. 
B) a registered agent. 
C) a sales representative. 
D) All of these.

Question 14

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year:
  
-What is Sudsy Soap's price-to-book ratio?

Accepted Answer

A) 0.5 
B) 0.9 
C) 1.5 
D) 2.0 
A) 0.5 
B) 0.9 
C) 1.5 
D) 2.0

Question 15

If the investor fails to put up additional cash or securities to maintain a required level of equity in a margin account,the broker will sell the securities at the market price.

Accepted Answer

A) True 
 B)False

Question 16

Hanna has 100 shares of Barnes,Inc.,which she purchased for $23 has been rising recently and is currently selling for $25 a share.She places an order with her broker to sell her Barnes shares when the price reaches $26.50 a share.This is an example of a ____ order.

Accepted Answer

A) stop 
B) limit 
C) market 
D) month 
A) stop 
B) limit 
C) market 
D) month

Question 17

An investor using the fundamental approach would look at

Accepted Answer

A) the management of the company. 
B) the outlook for the profitability of the industry. 
C) the value of an individual company. 
D) All of these. 
A) the management of the company. 
B) the outlook for the profitability of the industry. 
C) the value of an individual company. 
D) All of these.

Question 18

The market price for a company's common stock is usually higher than its book value per share.

Accepted Answer

A) True 
 B)False

Question 19

A prospectus describes the experience of the corporation's management,the company's financial status,any anticipated legal matters that could affect the company,and potential risks of investing in the firm.

Accepted Answer

A) True 
 B)False

Question 20

Rosa's is a small chain of Mexican food restaurants that features five delicious varieties of salsa. The business has grown over the past ten years from a hobby to a small corporation with 200,000 shares of common stock outstanding. The corporation has not issued any preferred stock. The following is Rosa's latest financial data:
  
-On the basis of Rosa's price-to-sales ratio,would market analysts generally be positive toward this stock?

Accepted Answer

A) Yes 
B) No 
A) Yes 
B) No

A specialist is a person on the floor of the exchange who handles trades of a particular stock in an effort to maintain a fair and orderly market.

Anderson Equipment Corporation has total after-tax earnings of $915,000 and 400,000 shares of common stock outstanding.What are the earnings per share for Anderson Equipment?

The limited liability of common stockholders refers to their

____ typically have voting rights.

Value stocks often operate within industries that benefit from a slowing economy.

Most trades are

The only public stock exchanges in the United States are the New York Stock Exchange and the American Stock Exchange.

Discount brokers typically provide personal investment advice as well as executing trades.

The default rate on high-quality bonds is slightly over 5 percent.

Other factors being equal,____ bonds will offer the highest yields.

There is no cost for placing a stop order if the order is never executed.

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year: -What is Sudsy Soap's PEG ratio?

Another name for a stockbroker is

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year: -What is Sudsy Soap's price-to-book ratio?

If the investor fails to put up additional cash or securities to maintain a required level of equity in a margin account,the broker will sell the securities at the market price.

Hanna has 100 shares of Barnes,Inc.,which she purchased for $23 has been rising recently and is currently selling for $25 a share.She places an order with her broker to sell her Barnes shares when the price reaches $26.50 a share.This is an example of a ____ order.

An investor using the fundamental approach would look at

The market price for a company's common stock is usually higher than its book value per share.

A prospectus describes the experience of the corporation's management,the company's financial status,any anticipated legal matters that could affect the company,and potential risks of investing in the firm.

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters

Exam 14: Investing in Stocks and Bonds

A specialist is a person on the floor of the exchange who handles trades of a particular stock in an effort to maintain a fair and orderly market.

Anderson Equipment Corporation has total after-tax earnings of $915,000 and 400,000 shares of common stock outstanding.What are the earnings per share for Anderson Equipment?

The limited liability of common stockholders refers to their

____ typically have voting rights.

Value stocks often operate within industries that benefit from a slowing economy.

Most trades are

The only public stock exchanges in the United States are the New York Stock Exchange and the American Stock Exchange.

Discount brokers typically provide personal investment advice as well as executing trades.

The default rate on high-quality bonds is slightly over 5 percent.

Other factors being equal,____ bonds will offer the highest yields.

There is no cost for placing a stop order if the order is never executed.

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year: -What is Sudsy Soap's PEG ratio?

Another name for a stockbroker is

Toni and Felix are considering buying stock. They would like to purchase 600 shares of Sudsy Soap stock at $35 a share. Sudsy Soap had the following figures for the past year: -What is Sudsy Soap's price-to-book ratio?

If the investor fails to put up additional cash or securities to maintain a required level of equity in a margin account,the broker will sell the securities at the market price.

Hanna has 100 shares of Barnes,Inc.,which she purchased for $23 has been rising recently and is currently selling for $25 a share.She places an order with her broker to sell her Barnes shares when the price reaches $26.50 a share.This is an example of a ____ order.

An investor using the fundamental approach would look at

The market price for a company's common stock is usually higher than its book value per share.

A prospectus describes the experience of the corporation's management,the company's financial status,any anticipated legal matters that could affect the company,and potential risks of investing in the firm.

Understanding Personal Finance

Career Planning

Financial Statements,tools,and Budgets

Managing Income Taxes

Managing Checking and Savings Accounts

Building and Maintaining Good Credit

Credit Cards and Consumer Loans

Vehicles and Other Major Purchases

Obtaining Affordable Housing

Managing Property and Liability Risk

Managing Health Expenses

Life Insurance Planning

Investment Fundamentals

Mutual Funds and Exchange Traded Funds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters