Question 1

Silver has more industrial and commercial uses than gold.

Accepted Answer

A) True 
 B)False

Question 2

In a real estate syndicate, a general partner has limited liability.

Accepted Answer

A) True 
 B)False

Question 3

Under some mortgage arrangements, the lender may loan the funds at a rate well below the current market rate.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following allow the individual to invest in gold without actually owning gold?

Accepted Answer

A) Gold stock 
B) Gold futures 
C) Options on gold futures 
D) All of the above 
A) Gold stock 
B) Gold futures 
C) Options on gold futures 
D) All of the above

Question 5

The best time to buy collectibles such as art, antiques, musical instruments, and the like is when:

Accepted Answer

A) the stock market is down. 
B) no one else seems very interested. 
C) a period of high inflation begins to level off. 
D) None of the above 
A) the stock market is down. 
B) no one else seems very interested. 
C) a period of high inflation begins to level off. 
D) None of the above

Question 6

The negative impact of tax reform on real estate was partly associated with declining economic conditions in various sections of the country during the late 1980s and early 1990s.

Accepted Answer

A) True 
 B)False

Question 7

Real assets are:

Accepted Answer

A) tangible assets that may be seen, felt, held, or collected. 
B) paper assets that are usually traded over an exchange. 
C) also known as financial assets. 
D) not diversifiable. 
A) tangible assets that may be seen, felt, held, or collected. 
B) paper assets that are usually traded over an exchange. 
C) also known as financial assets. 
D) not diversifiable.

Question 8

Common date gold coins may trade at ________ their pure bullion value.

Accepted Answer

A) 50-75% of 
B) 100% of 
C) 2 to 3 times 
D) 50 to 100 times 
A) 50-75% of 
B) 100% of 
C) 2 to 3 times 
D) 50 to 100 times

Question 9

Advantages of real assets over other types of investments include that:

Accepted Answer

A) they provide a good hedge against inflation. 
B) they tend to be negatively correlated with other types of investments. 
C) they provide personal pleasure to the investor. 
D) More than one of the above 
A) they provide a good hedge against inflation. 
B) they tend to be negatively correlated with other types of investments. 
C) they provide personal pleasure to the investor. 
D) More than one of the above

Question 10

The only tax benefit for real estate owners is depreciation allowances.

Accepted Answer

A) True 
 B)False

Question 11

A major advantage of real estate over other real assets is its liquidity.

Accepted Answer

A) True 
 B)False

Question 12

In recent times, suppliers of second mortgages have often been:

Accepted Answer

A) buyers of real estate. 
B) Real Estate Investment Trusts (REITs). 
C) sellers of real estate. 
D) real estate brokers. 
A) buyers of real estate. 
B) Real Estate Investment Trusts (REITs). 
C) sellers of real estate. 
D) real estate brokers.

Question 13

REITs are very similar to mutual funds or investment companies.

Accepted Answer

A) True 
 B)False

Question 14

The best time to buy collectibles is when:

Accepted Answer

A) the bloom is off the market and dealers are overburdened with inventory. 
B) there is a weekly story in The Wall Street Journal or BusinessWeek about fortunes being made in the collectible market. 
C) the economic outlook is moving from inflation to deflation. 
D) the economy is at a peak, headed for a downturn. 
A) the bloom is off the market and dealers are overburdened with inventory. 
B) there is a weekly story in The Wall Street Journal or BusinessWeek about fortunes being made in the collectible market. 
C) the economic outlook is moving from inflation to deflation. 
D) the economy is at a peak, headed for a downturn.

Question 15

Real estate investment trusts are similar to mutual funds or investment companies because:

Accepted Answer

A) they do not trade on organized exchanges, but do trade over-the-counter. 
B) they pool investors' funds. 
C) they are both limited partnerships. 
D) All of the above 
A) they do not trade on organized exchanges, but do trade over-the-counter. 
B) they pool investors' funds. 
C) they are both limited partnerships. 
D) All of the above

Question 16

Which is not an approach to real estate valuation?

Accepted Answer

A) Cost approach 
B) Comparative sales value 
C) Price-earnings ratio 
D) Income approach 
A) Cost approach 
B) Comparative sales value 
C) Price-earnings ratio 
D) Income approach

Question 17

Dealer spreads on real assets tend to be less than on stocks or bonds.

Accepted Answer

A) True 
 B)False

Question 18

The most significant advantage(s) of limited partnerships is(are):

Accepted Answer

A) limited liability of limited partners, and direct assignment of profits and losses to the partners. 
B) unlimited liability of general partners. 
C) favorable tax treatment of capital gains and management participation features. 
D) None of the above 
A) limited liability of limited partners, and direct assignment of profits and losses to the partners. 
B) unlimited liability of general partners. 
C) favorable tax treatment of capital gains and management participation features. 
D) None of the above

Question 19

The prices of gold and silver tend to be positively correlated with the stock market.

Accepted Answer

A) True 
 B)False

Question 20

Gold ownership is considered a hedge against inflation.

Accepted Answer

A) True 
 B)False

Exam 20: Investments in Real Assets

Silver has more industrial and commercial uses than gold.

In a real estate syndicate, a general partner has limited liability.

Under some mortgage arrangements, the lender may loan the funds at a rate well below the current market rate.

Which of the following allow the individual to invest in gold without actually owning gold?

The best time to buy collectibles such as art, antiques, musical instruments, and the like is when:

The negative impact of tax reform on real estate was partly associated with declining economic conditions in various sections of the country during the late 1980s and early 1990s.

Real assets are:

Common date gold coins may trade at ________ their pure bullion value.

Advantages of real assets over other types of investments include that:

The only tax benefit for real estate owners is depreciation allowances.

A major advantage of real estate over other real assets is its liquidity.

In recent times, suppliers of second mortgages have often been:

REITs are very similar to mutual funds or investment companies.

The best time to buy collectibles is when:

Real estate investment trusts are similar to mutual funds or investment companies because:

Which is not an approach to real estate valuation?

Dealer spreads on real assets tend to be less than on stocks or bonds.

The most significant advantage(s) of limited partnerships is(are):

The prices of gold and silver tend to be positively correlated with the stock market.

Gold ownership is considered a hedge against inflation.

The Investment Setting

Security Markets

Participating in the Market

Investment Companies: Mutual Funds, Exchange-Traded Funds, Closed-End Funds, and Unit Investment Trusts

Economic Activity

Industry Analysis

Valuation of the Individual Firm

Financial Statement Analysis

Efficient Markets and Anomalies

Behavioral Finance and Technical Analysis

Bond and Fixed-Income Fundamentals

Principles of Bond Valuation and Investment

Convertible Securities and Warrants

Put and Call Options

Commodities and Financial Futures

Stock Index Futures and Options

A Basic Look at Portfolio Management and Capital Market Theory

Duration and Bond Portfolio Management

International Securities Markets

Alternative Investments: Private Equity and Hedge Funds

Measuring Risks and Returns of Portfolio Managers

A Comprehensive Analysis for Real Estate Investment Decisions

The Makeup of Institutional Investors

Filters