Question 1

Which of the following allows you to easily move funds from one mutual fund to another managed by the same investment company?

Accepted Answer

A) exchange privilege 
B) automatic reinvestment 
C) rotation 
D) stock swap 
A) exchange privilege 
B) automatic reinvestment 
C) rotation 
D) stock swap

Question 2

Sean invested $10,000 in a mutual fund with a stated commission of 6 percent.If each share of the mutual fund had a net asset value of $27,how many shares would Sean be able to purchase?

Accepted Answer

A) 392.59 
B) 394.01 
C) 348.15 
D) 370.37 
A) 392.59 
B) 394.01 
C) 348.15 
D) 370.37

Question 3

Independent research has found that over five-year periods,lower-cost funds always deliver returns better than those offered by higher-cost funds.

Accepted Answer

A) True 
 B)False

Question 4

Net asset value increases when

Accepted Answer

A) the value of the underlying securities increases. 
B) gains realized on the underlying securities are paid out to shareholders. 
C) a mutual fund attracts new money from investors. 
D) All of these. 
A) the value of the underlying securities increases. 
B) gains realized on the underlying securities are paid out to shareholders. 
C) a mutual fund attracts new money from investors. 
D) All of these.

Question 5

Ordinary income dividend distributions earned on ____ funds is tax-exempt for federal income taxes.

Accepted Answer

A) small-cap 
B) balanced 
C) specialty 
D) municipal bond 
A) small-cap 
B) balanced 
C) specialty 
D) municipal bond

Question 6

If you want to receive periodic,regular income from your mutual fund account you would set up a

Accepted Answer

A) systematic withdrawal plan. 
B) closed-end withdrawal plan. 
C) guaranteed investment contract. 
D) beneficiary designation contract. 
A) systematic withdrawal plan. 
B) closed-end withdrawal plan. 
C) guaranteed investment contract. 
D) beneficiary designation contract.

Question 7

There are approximately ____ open-end mutual funds in the United States.

Accepted Answer

A) 2,800 
B) 3,678 
C) 8,100 
D) 13,000 
A) 2,800 
B) 3,678 
C) 8,100 
D) 13,000

Question 8

Target-date retirement funds are recommended for those who wish to actively manage their own investments.

Accepted Answer

A) True 
 B)False

Question 9

Investing in a mutual fund rather than an individual stock reduces

Accepted Answer

A) systemic risk. 
B) pure risk. 
C) market risk. 
D) random risk. 
A) systemic risk. 
B) pure risk. 
C) market risk. 
D) random risk.

Question 10

A useful measure of mutual fund's volatility is its expense ratio.

Accepted Answer

A) True 
 B)False

Question 11

Socially responsible funds usually invest in firms with good records pertaining to the environment,human rights,and public safety.

Accepted Answer

A) True 
 B)False

Question 12

Approximately ____ percent of all households invest in mutual funds.

Accepted Answer

A) 10 
B) 25 
C) 50 
D) 75 
A) 10 
B) 25 
C) 50 
D) 75

Question 13

Financial risk is reduced through mutual fund investments because the fund is able to diversify investments.

Accepted Answer

A) True 
 B)False

Question 14

Investing in a sector fund decreases risk and return because it is more diversified than other funds.

Accepted Answer

A) True 
 B)False

Question 15

Mutual fund quotations normally include the NAV,YTD Percentage Return,and the fund's expense ratio.

Accepted Answer

A) True 
 B)False

Question 16

It is easier to achieve diversification by investing in individual stocks and bonds rather than mutual funds.

Accepted Answer

A) True 
 B)False

Question 17

The type of mutual fund that is unmanaged is called a(n) ____ fund.

Accepted Answer

A) index 
B) sector 
C) money market 
D) emerging market 
A) index 
B) sector 
C) money market 
D) emerging market

Question 18

If you want to avoid paying capital gains taxes for the whole year on mutual fund shares purchased partway into the year,you would want to buy the shares after the

Accepted Answer

A) closing date. 
B) transaction date. 
C) record date. 
D) reinvestment period. 
A) closing date. 
B) transaction date. 
C) record date. 
D) reinvestment period.

Question 19

____ can be used to provide mutual fund information.

Accepted Answer

A) Mutual fund prospectuses 
B) Morningstar Mutual Funds 
C) Financial magazines such as Money and Forbes 
D) All of these. 
A) Mutual fund prospectuses 
B) Morningstar Mutual Funds 
C) Financial magazines such as Money and Forbes 
D) All of these.

Question 20

The SEC regulations regarding disclosure of fees include requiring a standardized expense table within the profile prospectus at the front of the fund's full prospectus.

Accepted Answer

A) True 
 B)False

Which of the following allows you to easily move funds from one mutual fund to another managed by the same investment company?

Sean invested $10,000 in a mutual fund with a stated commission of 6 percent.If each share of the mutual fund had a net asset value of $27,how many shares would Sean be able to purchase?

Independent research has found that over five-year periods,lower-cost funds always deliver returns better than those offered by higher-cost funds.

Net asset value increases when

Ordinary income dividend distributions earned on ____ funds is tax-exempt for federal income taxes.

If you want to receive periodic,regular income from your mutual fund account you would set up a

There are approximately ____ open-end mutual funds in the United States.

Target-date retirement funds are recommended for those who wish to actively manage their own investments.

Investing in a mutual fund rather than an individual stock reduces

A useful measure of mutual fund's volatility is its expense ratio.

Socially responsible funds usually invest in firms with good records pertaining to the environment,human rights,and public safety.

Approximately ____ percent of all households invest in mutual funds.

Financial risk is reduced through mutual fund investments because the fund is able to diversify investments.

Investing in a sector fund decreases risk and return because it is more diversified than other funds.

Mutual fund quotations normally include the NAV,YTD Percentage Return,and the fund's expense ratio.

It is easier to achieve diversification by investing in individual stocks and bonds rather than mutual funds.

The type of mutual fund that is unmanaged is called a(n) ____ fund.

If you want to avoid paying capital gains taxes for the whole year on mutual fund shares purchased partway into the year,you would want to buy the shares after the

____ can be used to provide mutual fund information.

The SEC regulations regarding disclosure of fees include requiring a standardized expense table within the profile prospectus at the front of the fund's full prospectus.

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Exam 15: Mutual Funds and Exchange Traded Funds

Which of the following allows you to easily move funds from one mutual fund to another managed by the same investment company?

Sean invested $10,000 in a mutual fund with a stated commission of 6 percent.If each share of the mutual fund had a net asset value of $27,how many shares would Sean be able to purchase?

Independent research has found that over five-year periods,lower-cost funds always deliver returns better than those offered by higher-cost funds.

Net asset value increases when

Ordinary income dividend distributions earned on ____ funds is tax-exempt for federal income taxes.

If you want to receive periodic,regular income from your mutual fund account you would set up a

There are approximately ____ open-end mutual funds in the United States.

Target-date retirement funds are recommended for those who wish to actively manage their own investments.

Investing in a mutual fund rather than an individual stock reduces

A useful measure of mutual fund's volatility is its expense ratio.

Socially responsible funds usually invest in firms with good records pertaining to the environment,human rights,and public safety.

Approximately ____ percent of all households invest in mutual funds.

Financial risk is reduced through mutual fund investments because the fund is able to diversify investments.

Investing in a sector fund decreases risk and return because it is more diversified than other funds.

Mutual fund quotations normally include the NAV,YTD Percentage Return,and the fund's expense ratio.

It is easier to achieve diversification by investing in individual stocks and bonds rather than mutual funds.

The type of mutual fund that is unmanaged is called a(n) ____ fund.

If you want to avoid paying capital gains taxes for the whole year on mutual fund shares purchased partway into the year,you would want to buy the shares after the

____ can be used to provide mutual fund information.

The SEC regulations regarding disclosure of fees include requiring a standardized expense table within the profile prospectus at the front of the fund's full prospectus.

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

Investing in Stocks and Bonds

Real Estate and High-Risk Investments

Retirement and Estate Planning

Filters