Question 1

A bankruptcy will remain on your credit report for __________ year(s).

Accepted Answer

A)  2 
B)  up to 10 
C)  no more than 7 
D)  20 or more 
E)  2 to 4 
A)  2 
B)  up to 10 
C)  no more than 7 
D)  20 or more 
E)  2 to 4

Question 2

Although useful for many things, the Internet cannot be used to monitor the value of stock, bond, and mutual fund investments.

Accepted Answer

A) True 
 B)False

Question 3

Which one of the following is a true statement?

Accepted Answer

A)  When choosing an investment, it is not necessary to consider the risk factor. 
B)  During inflationary times, there is a risk that the financial return on an investment will not keep pace with the rate of inflation. 
C)  The interest rate risk associated with investments in bonds is the result of changes in business conditions faced by companies. 
D)  The risk of business failure deals with changes in the value of stocks and bonds due to changes in interest rates in the market. 
E)  The prices of stocks, bonds, and other investments never fluctuate in the market. 
A)  When choosing an investment, it is not necessary to consider the risk factor. 
B)  During inflationary times, there is a risk that the financial return on an investment will not keep pace with the rate of inflation. 
C)  The interest rate risk associated with investments in bonds is the result of changes in business conditions faced by companies. 
D)  The risk of business failure deals with changes in the value of stocks and bonds due to changes in interest rates in the market. 
E)  The prices of stocks, bonds, and other investments never fluctuate in the market.

Question 4

The maturity dates for most bonds range between ____________ years.

Accepted Answer

A)  0 to 5 
B)  5 to 20 
C)  10 to 20 
D)  1 to 30 
E)  15 to 40 
A)  0 to 5 
B)  5 to 20 
C)  10 to 20 
D)  1 to 30 
E)  15 to 40

Question 5

All except which one of the following are good ways to acquire money for starting an investment program?

Accepted Answer

A)  Pay bills first, and then save a reasonable amount of money for investment 
B)  Participate in an elective savings program offered by your employer 
C)  Make a special savings effort one month per year 
D)  Borrow money specifically for investment purposes 
E)  Take advantage of gifts, inheritances, and windfalls 
A)  Pay bills first, and then save a reasonable amount of money for investment 
B)  Participate in an elective savings program offered by your employer 
C)  Make a special savings effort one month per year 
D)  Borrow money specifically for investment purposes 
E)  Take advantage of gifts, inheritances, and windfalls

Question 6

Bob McDowell is thinking about buying an investment. The most important consideration when making this investment is the location of the investment. What investment is Bob thinking about purchasing?

Accepted Answer

A)  Common stock 
B)  Preferred stock 
C)  Corporate bond 
D)  Real estate 
E)  Mutual fund 
A)  Common stock 
B)  Preferred stock 
C)  Corporate bond 
D)  Real estate 
E)  Mutual fund

Question 7

Based on historical performance, which one of the following investments is most apt to provide an average return of 10 percent a year between now and the year 2025?

Accepted Answer

A)  U.S. Treasury bills 
B)  Corporate bonds 
C)  Stocks 
D)  Options 
E)  Zero-coupon bonds 
A)  U.S. Treasury bills 
B)  Corporate bonds 
C)  Stocks 
D)  Options 
E)  Zero-coupon bonds

Question 8

Which one of the following is false?

Accepted Answer

A)  Most mutual funds invest in stocks, bonds, and other securities. 
B)  Diversification provided by a mutual fund reduces risk. 
C)  The goals of one mutual fund investor may differ from those of another. 
D)  Since mutual fund managers are professionals, there is no need to evaluate a mutual fund. 
E)  Mutual fund investments range from very conservative to very speculative investments. 
A)  Most mutual funds invest in stocks, bonds, and other securities. 
B)  Diversification provided by a mutual fund reduces risk. 
C)  The goals of one mutual fund investor may differ from those of another. 
D)  Since mutual fund managers are professionals, there is no need to evaluate a mutual fund. 
E)  Mutual fund investments range from very conservative to very speculative investments.

Question 9

The average investor cannot afford to purchase much of the investment information available from the U.S. government.

Accepted Answer

A) True 
 B)False

Question 10

The potential return of any investment should be directly related to the risk that the investor assumes.

Accepted Answer

A) True 
 B)False

Question 11

Potential investors should not wait until they put their financial affairs in order before starting to invest.

Accepted Answer

A) True 
 B)False

Question 12

The average credit card debt for college students is:

Accepted Answer

A)  $1,400. 
B)  $2,200. 
C)  $3,500. 
D)  $7,000. 
E)  $10,000. 
A)  $1,400. 
B)  $2,200. 
C)  $3,500. 
D)  $7,000. 
E)  $10,000.

Question 13

Carl Reimer has just received an inheritance of $40,000 from his mother and is trying to decide how to invest it. Carl is young and earns a good salary. Carl wants to invest in a small cap mutual fund. While he won't receive much in the way of cash dividends, the companies are reinvesting significant amounts so the sales revenue and earnings in the future will be much larger. What aspect of investing is Carl most concerned about?

Accepted Answer

A)  Risk 
B)  Return 
C)  Diversification 
D)  Liquidity 
E)  Investment growth 
A)  Risk 
B)  Return 
C)  Diversification 
D)  Liquidity 
E)  Investment growth

Question 14

Many financial planners typically charge hourly consulting fees in the following range:

Accepted Answer

A)  $10 - $30. 
B)  $50 - $70. 
C)  $75 - $200. 
D)  $125 - $250. 
E)  $150 - $300. 
A)  $10 - $30. 
B)  $50 - $70. 
C)  $75 - $200. 
D)  $125 - $250. 
E)  $150 - $300.

Question 15

Which one of the following is false?

Accepted Answer

A)  You can obtain recommendations to buy or sell stocks and other securities by accessing Internet sites. 
B)  There is a wealth of investment information available, but most small investors cannot afford to use it. 
C)  You can obtain current price information for stocks, bonds, and mutual funds by using the Internet. 
D)  A search engine is a research tool that helps you find the investment information you want. 
E)  Both government and businesses provide individuals with investment information. 
A)  You can obtain recommendations to buy or sell stocks and other securities by accessing Internet sites. 
B)  There is a wealth of investment information available, but most small investors cannot afford to use it. 
C)  You can obtain current price information for stocks, bonds, and mutual funds by using the Internet. 
D)  A search engine is a research tool that helps you find the investment information you want. 
E)  Both government and businesses provide individuals with investment information.

Question 16

It is suggested that for young investors, ____ percent of their investment portfolio allocated to large-cap stocks.

Accepted Answer

A)  30 
B)  40 
C)  50 
D)  60 
E)  70 
A)  30 
B)  40 
C)  50 
D)  60 
E)  70

Question 17

What is the primary goal of asset allocation?

Accepted Answer

A)  Investment income 
B)  Growth 
C)  Liquidity 
D)  Return 
E)  Risk reduction 
A)  Investment income 
B)  Growth 
C)  Liquidity 
D)  Return 
E)  Risk reduction

Question 18

A line of credit is a short-term loan that is approved before the money is actually needed.

Accepted Answer

A) True 
 B)False

Question 19

The money obtained by a company from selling corporate bonds:

Accepted Answer

A)  is obtained from lenders. 
B)  is obtained from the owners of the business. 
C)  is obtained from employee stock option programs. 
D)  does not have to be repaid. 
E)  must be allocated to retirement programs. 
A)  is obtained from lenders. 
B)  is obtained from the owners of the business. 
C)  is obtained from employee stock option programs. 
D)  does not have to be repaid. 
E)  must be allocated to retirement programs.

Question 20

Which one of the following investments would rank the highest with regard to safety?

Accepted Answer

A)  Government bond 
B)  Common stock 
C)  Preferred stock 
D)  Corporate bond 
E)  Real estate 
A)  Government bond 
B)  Common stock 
C)  Preferred stock 
D)  Corporate bond 
E)  Real estate

A bankruptcy will remain on your credit report for __________ year(s).

Although useful for many things, the Internet cannot be used to monitor the value of stock, bond, and mutual fund investments.

Which one of the following is a true statement?

The maturity dates for most bonds range between ____________ years.

All except which one of the following are good ways to acquire money for starting an investment program?

Bob McDowell is thinking about buying an investment. The most important consideration when making this investment is the location of the investment. What investment is Bob thinking about purchasing?

Based on historical performance, which one of the following investments is most apt to provide an average return of 10 percent a year between now and the year 2025?

Which one of the following is false?

The average investor cannot afford to purchase much of the investment information available from the U.S. government.

The potential return of any investment should be directly related to the risk that the investor assumes.

Potential investors should not wait until they put their financial affairs in order before starting to invest.

The average credit card debt for college students is:

Many financial planners typically charge hourly consulting fees in the following range:

Which one of the following is false?

It is suggested that for young investors, ____ percent of their investment portfolio allocated to large-cap stocks.

What is the primary goal of asset allocation?

A line of credit is a short-term loan that is approved before the money is actually needed.

The money obtained by a company from selling corporate bonds:

Which one of the following investments would rank the highest with regard to safety?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters

Exam 13: Investing Fundamentals

A bankruptcy will remain on your credit report for __________ year(s).

Although useful for many things, the Internet cannot be used to monitor the value of stock, bond, and mutual fund investments.

Which one of the following is a true statement?

The maturity dates for most bonds range between ____________ years.

All except which one of the following are good ways to acquire money for starting an investment program?

Bob McDowell is thinking about buying an investment. The most important consideration when making this investment is the location of the investment. What investment is Bob thinking about purchasing?

Based on historical performance, which one of the following investments is most apt to provide an average return of 10 percent a year between now and the year 2025?

Which one of the following is false?

The average investor cannot afford to purchase much of the investment information available from the U.S. government.

The potential return of any investment should be directly related to the risk that the investor assumes.

Potential investors should not wait until they put their financial affairs in order before starting to invest.

The average credit card debt for college students is:

Many financial planners typically charge hourly consulting fees in the following range:

Which one of the following is false?

It is suggested that for young investors, ____ percent of their investment portfolio allocated to large-cap stocks.

What is the primary goal of asset allocation?

A line of credit is a short-term loan that is approved before the money is actually needed.

The money obtained by a company from selling corporate bonds:

Which one of the following investments would rank the highest with regard to safety?

Personal Finance Basics and the Time Value of Money

Financial Aspects of Career Planning

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Financial Services: Savings Plans and Payment Accounts

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

Consumer Purchasing Strategies and Legal Protection

The Housing Decision: Factors and Finances

Property and Motor Vehicle Insurance

Health, Disability, and Long-Term Care Insurance

Life Insurance

Investing in Stocks

Investing in Bonds

Investing in Mutual Funds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters