Question 1

Marcie is seeking interest income but wants to ensure that her investment is as safe as possible.Which type of mutual fund best fits her requirements?

Accepted Answer

A) Junk bond fund 
B) Intermediate corporate bond fund 
C) Growth fund 
D) Short-term government bond 
E) World bond fund 
A) Junk bond fund 
B) Intermediate corporate bond fund 
C) Growth fund 
D) Short-term government bond 
E) World bond fund

Question 2

A mutual fund that invests in investment-grade corporate debt with maturities between 3 and 10 years is called a ____________ fund.

Accepted Answer

A) long-term bond 
B) growth 
C) sector 
D) income 
E) intermediate corporate bond 
A) long-term bond 
B) growth 
C) sector 
D) income 
E) intermediate corporate bond

Question 3

Christopher Fishbone is buying shares in a mutual fund that invests in companies that are all in the natural resources industry.What type of mutual fund is he buying?

Accepted Answer

A) Socially responsible fund 
B) Sector fund 
C) Small-cap fund 
D) Index fund 
E) Growth fund 
A) Socially responsible fund 
B) Sector fund 
C) Small-cap fund 
D) Index fund 
E) Growth fund

Question 4

Which one of the following is not a withdrawal option for a mutual fund?

Accepted Answer

A) Withdrawing a specified, fixed dollar amount each investment period 
B) Liquidating, or "selling off" a certain number of shares each investment period 
C) Withdrawing a fixed percentage of asset growth 
D) Withdrawing all asset growth earned during an investment period 
E) Withdrawing a stated amount and treating it as a short-term loan 
A) Withdrawing a specified, fixed dollar amount each investment period 
B) Liquidating, or "selling off" a certain number of shares each investment period 
C) Withdrawing a fixed percentage of asset growth 
D) Withdrawing all asset growth earned during an investment period 
E) Withdrawing a stated amount and treating it as a short-term loan

Question 5

While mutual fund income dividends are subject to taxation,capital gain distributions are not subject to taxation.

Accepted Answer

A) True 
 B)False

Question 6

Mary Cooper just purchased 100 shares in the All-American Fund.The purchase cost for each share was $20.If this fund charges a 5 percent load,what is the total amount of commission she will pay the investment company?

Accepted Answer

A) $100 
B) $1,000 
C) $2,000 
D) $200 
E) $1 
A) $100 
B) $1,000 
C) $2,000 
D) $200 
E) $1

Question 7

Contingent deferred sales loads may also be referred to as ____ loads.

Accepted Answer

A) front-end 
B) back-end 
C) level 
D) purchase 
E) investiture 
A) front-end 
B) back-end 
C) level 
D) purchase 
E) investiture

Question 8

The All-Star Basic Value Fund's portfolio is valued at $210 million.The fund has liabilities of $5 million,and the fund's net asset value is $12.50.What is the fund's number of shares outstanding?

Accepted Answer

A) 5,000,000 
B) 7,500,000 
C) 12,500,000 
D) 16,400,000 
E) 38,720,000 
A) 5,000,000 
B) 7,500,000 
C) 12,500,000 
D) 16,400,000 
E) 38,720,000

Question 9

Together,all the different management fees,12b-1 fees,and additional operating costs for a specific fund are referred to as a(n):

Accepted Answer

A) investment ratio. 
B) expense ratio. 
C) financial ratio. 
D) expense turnover. 
E) management ratio. 
A) investment ratio. 
B) expense ratio. 
C) financial ratio. 
D) expense turnover. 
E) management ratio.

Question 10

A fee that investors pay when they withdraw their investment from a mutual fund is called a:

Accepted Answer

A) withdrawal fee. 
B) 12b 
C) contingent deferred sales load. 
D) front-end load. 
E) management fee. 
A) withdrawal fee. 
B) 12b 
C) contingent deferred sales load. 
D) front-end load. 
E) management fee.

Question 11

When you decide to redeem shares in an open-end mutual fund,the only option is to sell off a specific number of shares.

Accepted Answer

A) True 
 B)False

Question 12

Over many years,the majority of managed mutual funds outperform the Standard & Poor's 500 stock index.

Accepted Answer

A) True 
 B)False

Question 13

An investment company sponsoring a mutual fund must give existing shareholders a prospectus.

Accepted Answer

A) True 
 B)False

Question 14

Will Hopkins is getting ready to purchase shares in a mutual fund.He will have to pay an upfront sales commission to purchase these shares.What type of shares is he buying?

Accepted Answer

A) Class A 
B) Class B 
C) Class C 
D) Either class A or B 
E) Either class B or C 
A) Class A 
B) Class B 
C) Class C 
D) Either class A or B 
E) Either class B or C

Question 15

Louise Prescott is buying shares in a mutual fund that invests in larger,well-established companies that are expecting higher-than-average revenues and earnings growth.What type of mutual fund is she buying?

Accepted Answer

A) Socially responsible fund 
B) Sector fund 
C) Small-cap fund 
D) Index fund 
E) Growth fund 
A) Socially responsible fund 
B) Sector fund 
C) Small-cap fund 
D) Index fund 
E) Growth fund

Question 16

While advisory services provide detailed information on common and preferred stocks,there are no advisory services that provide information on mutual funds.

Accepted Answer

A) True 
 B)False

Question 17

Mutual funds have been around for a long time and became popular in the U.S.before the Great Depression in 1929.

Accepted Answer

A) True 
 B)False

Question 18

To purchase shares in an open-end mutual fund from an investment company,you may use four options: regular account transactions,voluntary savings plans,contractual savings plans,and reinvestment plans.

Accepted Answer

A) True 
 B)False

Question 19

The New American Enterprise Mutual Fund's portfolio is valued at $120 million.The fund has liabilities of $4 million,and the investment company sponsoring the fund has issued 5,800,000 shares.What is the fund's net asset value?

Accepted Answer

A) $120 
B) $58 
C) $40 
D) $30 
E) $20 
A) $120 
B) $58 
C) $40 
D) $30 
E) $20

Question 20

When you invest in Class A shares,you pay a sales commission when you sell your mutual fund shares.

Accepted Answer

A) True 
 B)False

Marcie is seeking interest income but wants to ensure that her investment is as safe as possible.Which type of mutual fund best fits her requirements?

A mutual fund that invests in investment-grade corporate debt with maturities between 3 and 10 years is called a ____________ fund.

Christopher Fishbone is buying shares in a mutual fund that invests in companies that are all in the natural resources industry.What type of mutual fund is he buying?

Which one of the following is not a withdrawal option for a mutual fund?

While mutual fund income dividends are subject to taxation,capital gain distributions are not subject to taxation.

Mary Cooper just purchased 100 shares in the All-American Fund.The purchase cost for each share was $20.If this fund charges a 5 percent load,what is the total amount of commission she will pay the investment company?

Contingent deferred sales loads may also be referred to as ____ loads.

The All-Star Basic Value Fund's portfolio is valued at $210 million.The fund has liabilities of $5 million,and the fund's net asset value is $12.50.What is the fund's number of shares outstanding?

Together,all the different management fees,12b-1 fees,and additional operating costs for a specific fund are referred to as a(n):

A fee that investors pay when they withdraw their investment from a mutual fund is called a:

When you decide to redeem shares in an open-end mutual fund,the only option is to sell off a specific number of shares.

Over many years,the majority of managed mutual funds outperform the Standard & Poor's 500 stock index.

An investment company sponsoring a mutual fund must give existing shareholders a prospectus.

Will Hopkins is getting ready to purchase shares in a mutual fund.He will have to pay an upfront sales commission to purchase these shares.What type of shares is he buying?

Louise Prescott is buying shares in a mutual fund that invests in larger,well-established companies that are expecting higher-than-average revenues and earnings growth.What type of mutual fund is she buying?

While advisory services provide detailed information on common and preferred stocks,there are no advisory services that provide information on mutual funds.

Mutual funds have been around for a long time and became popular in the U.S.before the Great Depression in 1929.

To purchase shares in an open-end mutual fund from an investment company,you may use four options: regular account transactions,voluntary savings plans,contractual savings plans,and reinvestment plans.

The New American Enterprise Mutual Fund's portfolio is valued at $120 million.The fund has liabilities of $4 million,and the investment company sponsoring the fund has issued 5,800,000 shares.What is the fund's net asset value?

When you invest in Class A shares,you pay a sales commission when you sell your mutual fund shares.

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 Fundamentals

Investing in Stock

Investing in Bonds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

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Exam 16: Investing in Mutual Funds

Marcie is seeking interest income but wants to ensure that her investment is as safe as possible.Which type of mutual fund best fits her requirements?

A mutual fund that invests in investment-grade corporate debt with maturities between 3 and 10 years is called a ____________ fund.

Christopher Fishbone is buying shares in a mutual fund that invests in companies that are all in the natural resources industry.What type of mutual fund is he buying?

Which one of the following is not a withdrawal option for a mutual fund?

While mutual fund income dividends are subject to taxation,capital gain distributions are not subject to taxation.

Mary Cooper just purchased 100 shares in the All-American Fund.The purchase cost for each share was $20.If this fund charges a 5 percent load,what is the total amount of commission she will pay the investment company?

Contingent deferred sales loads may also be referred to as ____ loads.

The All-Star Basic Value Fund's portfolio is valued at $210 million.The fund has liabilities of $5 million,and the fund's net asset value is $12.50.What is the fund's number of shares outstanding?

Together,all the different management fees,12b-1 fees,and additional operating costs for a specific fund are referred to as a(n):

A fee that investors pay when they withdraw their investment from a mutual fund is called a:

When you decide to redeem shares in an open-end mutual fund,the only option is to sell off a specific number of shares.

Over many years,the majority of managed mutual funds outperform the Standard & Poor's 500 stock index.

An investment company sponsoring a mutual fund must give existing shareholders a prospectus.

Will Hopkins is getting ready to purchase shares in a mutual fund.He will have to pay an upfront sales commission to purchase these shares.What type of shares is he buying?

Louise Prescott is buying shares in a mutual fund that invests in larger,well-established companies that are expecting higher-than-average revenues and earnings growth.What type of mutual fund is she buying?

While advisory services provide detailed information on common and preferred stocks,there are no advisory services that provide information on mutual funds.

Mutual funds have been around for a long time and became popular in the U.S.before the Great Depression in 1929.

To purchase shares in an open-end mutual fund from an investment company,you may use four options: regular account transactions,voluntary savings plans,contractual savings plans,and reinvestment plans.

The New American Enterprise Mutual Fund's portfolio is valued at $120 million.The fund has liabilities of $4 million,and the investment company sponsoring the fund has issued 5,800,000 shares.What is the fund's net asset value?

When you invest in Class A shares,you pay a sales commission when you sell your mutual fund shares.

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 Fundamentals

Investing in Stock

Investing in Bonds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters