Question 1

Value funds specialize in securities of companies that are

Accepted Answer

A) small. 
B) underpriced. 
C) growing rapidly. 
D) well established. 
A) small. 
B) underpriced. 
C) growing rapidly. 
D) well established.

Question 2

Mutual funds have distinct features that make this form of investing both unique and investor-friendly.

Accepted Answer

A) True 
 B)False

Question 3

A(n)____ guarantees the owner a fixed or floating interest rate for predetermined period of time with full return of the initial amount invested.

Accepted Answer

A) guaranteed investment contract (GI
C)  
B) unit investment trust 
C) index fund 
D) mortgage-backed fund 
A) guaranteed investment contract (GI
C)  
B) unit investment trust 
C) index fund 
D) mortgage-backed fund

Question 4

SEC regulations require all of the following except

Accepted Answer

A) that a prospectus be provided to mutual fund shareholders. 
B) that 12b-1 fees be capped at 0.75 percent. 
C) that a minimum guaranteed rate of return must be specified in the prospectus. 
D) that a mutual fund's prospectus include a standardized expense table. 
A) that a prospectus be provided to mutual fund shareholders. 
B) that 12b-1 fees be capped at 0.75 percent. 
C) that a minimum guaranteed rate of return must be specified in the prospectus. 
D) that a mutual fund's prospectus include a standardized expense table.

Question 5

A 12b-1 fee is imposed if the investor redeems shares within a specified number of years after purchase.

Accepted Answer

A) True 
 B)False

Question 6

A(n) ____ buys and holds an unmanaged fixed portfolio of fixed-maturity securities such as municipal bonds.

Accepted Answer

A) exchange-traded fund 
B) real estate investment trust 
C) unit investment trust 
D) sector fund 
A) exchange-traded fund 
B) real estate investment trust 
C) unit investment trust 
D) sector fund

Question 7

The price of a mutual fund share excluding any transaction cost is its

Accepted Answer

A) expense ratio. 
B) net income. 
C) net asset value. 
D) exchange rate. 
A) expense ratio. 
B) net income. 
C) net asset value. 
D) exchange rate.

Question 8

The stated commission on a load mutual fund is an accurate measure of the load being assessed.

Accepted Answer

A) True 
 B)False

Question 9

A 12b-1 fee is a hidden load because it increases a shareholder's earning power each year without being described as a sales commission.

Accepted Answer

A) True 
 B)False

Question 10

A mutual fund family is a group of individual funds under the same management company.

Accepted Answer

A) True 
 B)False

Question 11

Similar to corporate shareholders,holders of mutual funds have a say in running the company,since they have equity interest in the pool of assets and a residual claim on the profits.

Accepted Answer

A) True 
 B)False

Question 12

Target-risk funds offer a way to diversify one's portfolio based on risk tolerance.

Accepted Answer

A) True 
 B)False

Question 13

It is much easier to select specific stocks and bonds than it is to select an open-end mutual fund share.

Accepted Answer

A) True 
 B)False

Question 14

The stated commission on a load mutual fund is not an accurate depiction of the commission (load).

Accepted Answer

A) True 
 B)False

Question 15

You redeem your shares in an open-end mutual fund by selling them to another investor.

Accepted Answer

A) True 
 B)False

Question 16

A charge that often decreases 1 percent each year the investor owns shares in the fund is called a

Accepted Answer

A) redemption fee. 
B) 12b-1 fee. 
C) management fee. 
D) back-end load. 
A) redemption fee. 
B) 12b-1 fee. 
C) management fee. 
D) back-end load.

Question 17

A common stock fund that invests in only one industry such as construction companies is called a(n) ____ fund.

Accepted Answer

A) index 
B) sector 
C) maximum capital gains 
D) growth and income 
A) index 
B) sector 
C) maximum capital gains 
D) growth and income

Question 18

There are more open-end mutual funds than there are companies listed on the New York Stock Exchange.

Accepted Answer

A) True 
 B)False

Question 19

There are approximately ____ mutual fund families in the United States.

Accepted Answer

A) 400 
B) 2,800 
C) 3,678 
D) 13,000 
A) 400 
B) 2,800 
C) 3,678 
D) 13,000

Question 20

A mutual fund is a type of investment company.

Accepted Answer

A) True 
 B)False

Value funds specialize in securities of companies that are

Mutual funds have distinct features that make this form of investing both unique and investor-friendly.

A(n)____ guarantees the owner a fixed or floating interest rate for predetermined period of time with full return of the initial amount invested.

SEC regulations require all of the following except

A 12b-1 fee is imposed if the investor redeems shares within a specified number of years after purchase.

A(n) ____ buys and holds an unmanaged fixed portfolio of fixed-maturity securities such as municipal bonds.

The price of a mutual fund share excluding any transaction cost is its

The stated commission on a load mutual fund is an accurate measure of the load being assessed.

A 12b-1 fee is a hidden load because it increases a shareholder's earning power each year without being described as a sales commission.

A mutual fund family is a group of individual funds under the same management company.

Similar to corporate shareholders,holders of mutual funds have a say in running the company,since they have equity interest in the pool of assets and a residual claim on the profits.

Target-risk funds offer a way to diversify one's portfolio based on risk tolerance.

It is much easier to select specific stocks and bonds than it is to select an open-end mutual fund share.

The stated commission on a load mutual fund is not an accurate depiction of the commission (load).

You redeem your shares in an open-end mutual fund by selling them to another investor.

A charge that often decreases 1 percent each year the investor owns shares in the fund is called a

A common stock fund that invests in only one industry such as construction companies is called a(n) ____ fund.

There are more open-end mutual funds than there are companies listed on the New York Stock Exchange.

There are approximately ____ mutual fund families in the United States.

A mutual fund is a type of investment company.

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Exam 15: Mutual Funds and Exchange Traded Funds

Value funds specialize in securities of companies that are

Mutual funds have distinct features that make this form of investing both unique and investor-friendly.

A(n)____ guarantees the owner a fixed or floating interest rate for predetermined period of time with full return of the initial amount invested.

SEC regulations require all of the following except

A 12b-1 fee is imposed if the investor redeems shares within a specified number of years after purchase.

A(n) ____ buys and holds an unmanaged fixed portfolio of fixed-maturity securities such as municipal bonds.

The price of a mutual fund share excluding any transaction cost is its

The stated commission on a load mutual fund is an accurate measure of the load being assessed.

A 12b-1 fee is a hidden load because it increases a shareholder's earning power each year without being described as a sales commission.

A mutual fund family is a group of individual funds under the same management company.

Similar to corporate shareholders,holders of mutual funds have a say in running the company,since they have equity interest in the pool of assets and a residual claim on the profits.

Target-risk funds offer a way to diversify one's portfolio based on risk tolerance.

It is much easier to select specific stocks and bonds than it is to select an open-end mutual fund share.

The stated commission on a load mutual fund is not an accurate depiction of the commission (load).

You redeem your shares in an open-end mutual fund by selling them to another investor.

A charge that often decreases 1 percent each year the investor owns shares in the fund is called a

A common stock fund that invests in only one industry such as construction companies is called a(n) ____ fund.

There are more open-end mutual funds than there are companies listed on the New York Stock Exchange.

There are approximately ____ mutual fund families in the United States.

A mutual fund is a type of investment company.

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