Question 1

Mutual funds charge the 12b-1 fee to offset advertising and marketing costs.

Accepted Answer

A) True 
 B)False

Question 2

All information related to management fees,contingent deferred sales fees,12b-1 fees,and other expenses are contained in a mutual fund's fee table.

Accepted Answer

A) True 
 B)False

Question 3

Which one of the following statements is false?

Accepted Answer

A) As an investor,you should be concerned with how long a fund manager has been managing a mutual fund. 
B) Often,a fund's success is tied to the manager's ability to buy and sell securities in the fund. 
C) If a manager has been managing a fund for 5 or 10 years,it is time to change managers and get someone with new ideas. 
D) Ultimately,the fund manager is responsible for a fund's success. 
E) Managed funds may be open-end funds or closed-end funds. 
A) As an investor,you should be concerned with how long a fund manager has been managing a mutual fund. 
B) Often,a fund's success is tied to the manager's ability to buy and sell securities in the fund. 
C) If a manager has been managing a fund for 5 or 10 years,it is time to change managers and get someone with new ideas. 
D) Ultimately,the fund manager is responsible for a fund's success. 
E) Managed funds may be open-end funds or closed-end funds.

Question 4

Shares in an open-end fund are redeemed by the investment company at the request of the investor.

Accepted Answer

A) True 
 B)False

Question 5

The net asset value for a mutual fund share is calculated by dividing the value of the fund's portfolio by the fund's liabilities.

Accepted Answer

A) True 
 B)False

Question 6

In a newspaper quotation,NAV stands for "not accessible value."

Accepted Answer

A) True 
 B)False

Question 7

Another name for a mutual fund that doesn't charge a load,but does charge an ongoing higher 12b-1 fee is a class ____________ fund.

Accepted Answer

A) A 
B) B 
C) C 
D) D 
E) E 
A) A 
B) B 
C) C 
D) D 
E) E

Question 8

Christopher Fishbone is buying shares in a mutual fund that invests in companies that are all within the same 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 9

A mutual fund in which new shares are issued and existing shares redeemed by the investment company at the request of investors is called a(n)____________ fund.

Accepted Answer

A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible 
A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible

Question 10

Approximately ____________ percent of all mutual funds are open-end funds.

Accepted Answer

A) 5 
B) 6 
C) 30 
D) 72 
E) 92 
A) 5 
B) 6 
C) 30 
D) 72 
E) 92

Question 11

Which type of mutual fund invests primarily in corporate bonds with maturities between 5 and 10 years?

Accepted Answer

A) junk bond fund 
B) intermediate corporate bond fund 
C) municipal bond fund 
D) short-term government bond 
E) world bond fund 
A) junk bond fund 
B) intermediate corporate bond fund 
C) municipal bond fund 
D) short-term government bond 
E) world bond fund

Question 12

A closed end-fund is:

Accepted Answer

A) a fund that generally invests only in the stocks or other securities contained in a specific stock or securities index. 
B) a fund whose shares are issued by an investment company only when the fund is organized. 
C) professionally managed so investors need not monitor the performance of the fund. 
D) a fund whose shares are issued and redeemed by the investment company at the request of investors. 
E) one whose shares trade only at end-of-the-day prices. 
A) a fund that generally invests only in the stocks or other securities contained in a specific stock or securities index. 
B) a fund whose shares are issued by an investment company only when the fund is organized. 
C) professionally managed so investors need not monitor the performance of the fund. 
D) a fund whose shares are issued and redeemed by the investment company at the request of investors. 
E) one whose shares trade only at end-of-the-day prices.

Question 13

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? (Change as shown. )

Accepted Answer

A) junk bond fund 
B) intermediate corporate bond fund 
C) municipal bond fund 
D) short-term government bond 
E) world bond fund 
A) junk bond fund 
B) intermediate corporate bond fund 
C) municipal bond fund 
D) short-term government bond 
E) world bond fund

Question 14

A mutual fund in which no sales charge is paid by the individual investor is called a(n)____________ fund.

Accepted Answer

A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible fund. 
A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible fund.

Question 15

A mutual fund that invests in common stocks and bonds with the primary objectives of conserving capital,providing income,and long-term growth is called a(n)____________ fund.

Accepted Answer

A) balanced 
B) growth 
C) industry 
D) income 
E) money market 
A) balanced 
B) growth 
C) industry 
D) income 
E) money market

Question 16

Which one of the following is true with respect to closed-end funds?

Accepted Answer

A) Shares are issued whenever an investor wants to purchase them. 
B) Most of the funds today are closed-end. 
C) Shares are traded on stock exchanges similar to stocks. 
D) Shares always trade at NAV. 
E) Investors redeem their shares by selling them directly to the fund. 
A) Shares are issued whenever an investor wants to purchase them. 
B) Most of the funds today are closed-end. 
C) Shares are traded on stock exchanges similar to stocks. 
D) Shares always trade at NAV. 
E) Investors redeem their shares by selling them directly to the fund.

Question 17

In a newspaper quotation,which one of the following letters would indicate if a mutual fund has a 12b-1 fee?

Accepted Answer

A) NL 
B) r 
C) p 
D) t 
E) w 
A) NL 
B) r 
C) p 
D) t 
E) w

Question 18

A mutual fund in which shares are issued only when the fund is organized is called a(n)____________ fund.

Accepted Answer

A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible 
A) closed-end 
B) open-end 
C) load 
D) no-load 
E) convertible

Question 19

Mutual funds that invest in a variety of smaller,lesser-known companies that offer higher growth potential are referred to as sector funds.

Accepted Answer

A) True 
 B)False

Question 20

Investors in closed-end,exchange-traded funds,and open-end funds can make money by purchasing shares at a low price and then selling them at a higher price.

Accepted Answer

A) True 
 B)False

Mutual funds charge the 12b-1 fee to offset advertising and marketing costs.

All information related to management fees,contingent deferred sales fees,12b-1 fees,and other expenses are contained in a mutual fund's fee table.

Which one of the following statements is false?

Shares in an open-end fund are redeemed by the investment company at the request of the investor.

The net asset value for a mutual fund share is calculated by dividing the value of the fund's portfolio by the fund's liabilities.

In a newspaper quotation,NAV stands for "not accessible value."

Another name for a mutual fund that doesn't charge a load,but does charge an ongoing higher 12b-1 fee is a class ____________ fund.

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

A mutual fund in which new shares are issued and existing shares redeemed by the investment company at the request of investors is called a(n)____________ fund.

Approximately ____________ percent of all mutual funds are open-end funds.

Which type of mutual fund invests primarily in corporate bonds with maturities between 5 and 10 years?

A closed end-fund is:

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? (Change as shown. )

A mutual fund in which no sales charge is paid by the individual investor is called a(n)____________ fund.

A mutual fund that invests in common stocks and bonds with the primary objectives of conserving capital,providing income,and long-term growth is called a(n)____________ fund.

Which one of the following is true with respect to closed-end funds?

In a newspaper quotation,which one of the following letters would indicate if a mutual fund has a 12b-1 fee?

A mutual fund in which shares are issued only when the fund is organized is called a(n)____________ fund.

Mutual funds that invest in a variety of smaller,lesser-known companies that offer higher growth potential are referred to as sector funds.

Investors in closed-end,exchange-traded funds,and open-end funds can make money by purchasing shares at a low price and then selling them at a higher price.

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 Stocks

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

Mutual funds charge the 12b-1 fee to offset advertising and marketing costs.

All information related to management fees,contingent deferred sales fees,12b-1 fees,and other expenses are contained in a mutual fund's fee table.

Which one of the following statements is false?

Shares in an open-end fund are redeemed by the investment company at the request of the investor.

The net asset value for a mutual fund share is calculated by dividing the value of the fund's portfolio by the fund's liabilities.

In a newspaper quotation,NAV stands for "not accessible value."

Another name for a mutual fund that doesn't charge a load,but does charge an ongoing higher 12b-1 fee is a class ____________ fund.

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

A mutual fund in which new shares are issued and existing shares redeemed by the investment company at the request of investors is called a(n)____________ fund.

Approximately ____________ percent of all mutual funds are open-end funds.

Which type of mutual fund invests primarily in corporate bonds with maturities between 5 and 10 years?

A closed end-fund is:

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? (Change as shown. )

A mutual fund in which no sales charge is paid by the individual investor is called a(n)____________ fund.

A mutual fund that invests in common stocks and bonds with the primary objectives of conserving capital,providing income,and long-term growth is called a(n)____________ fund.

Which one of the following is true with respect to closed-end funds?

In a newspaper quotation,which one of the following letters would indicate if a mutual fund has a 12b-1 fee?

A mutual fund in which shares are issued only when the fund is organized is called a(n)____________ fund.

Mutual funds that invest in a variety of smaller,lesser-known companies that offer higher growth potential are referred to as sector funds.

Investors in closed-end,exchange-traded funds,and open-end funds can make money by purchasing shares at a low price and then selling them at a higher price.

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 Stocks

Investing in Bonds

Investing in Real Estate and Other Investment Alternatives

Starting Early: Retirement Planning

Estate Planning

Filters