Question 1

Describe the steps involved in a typical margin transaction.

Accepted Answer

You may want to compare the st

Question 2

To calculate the annual dividend yield, the annual dividend is divided by the stock's

Accepted Answer

A)  current price. 
B)  historical average price. 
C)  future price. 
D)  beginning-of-year price. 
E)  end-of-year price. 
A)  current price. 
B)  historical average price. 
C)  future price. 
D)  beginning-of-year price. 
E)  end-of-year price.

Question 3

Which of the following is not a true statement?

Accepted Answer

A)  A high price-earnings ratio means high projected earnings in the future. 
B)  The price-earnings ratio for a corporation must be studied over a period of time. 
C)  The price-earnings ratio is based on the company's dividends. 
D)  The price-earnings ratio for one firm may be compared to the price-earnings ratio for all firms. 
E)  A low price-earnings ratio indicates that a stock may be a good investment and a high price-earnings ratios may indicate that it is a poor investment. 
A)  A high price-earnings ratio means high projected earnings in the future. 
B)  The price-earnings ratio for a corporation must be studied over a period of time. 
C)  The price-earnings ratio is based on the company's dividends. 
D)  The price-earnings ratio for one firm may be compared to the price-earnings ratio for all firms. 
E)  A low price-earnings ratio indicates that a stock may be a good investment and a high price-earnings ratios may indicate that it is a poor investment.

Question 4

A stock that remains stable during declines in the economy is called a(n) ____________ stock.

Accepted Answer

A)  defensive 
B)  cyclical 
C)  growth 
D)  income 
E)  blue-chip 
A)  defensive 
B)  cyclical 
C)  growth 
D)  income 
E)  blue-chip

Question 5

A private corporation is a corporation whose stock is owned by relatively few people and is not traded openly in the stock market.

Accepted Answer

A) True 
 B)False

Question 6

Capitalization is ___________

Accepted Answer

A)  issued by a company that has a capitalization of $150 million or less. 
B)  issued by a corporation that has the potential to earn profits above the average profits of all firms in the economy. 
C)  the total amount of securities-stocks and bonds-issued by a corporation. 
D)  follows the business cycle of advances and declines in the economy. 
E)  A safe investment that generally attracts conservative investors 
A)  issued by a company that has a capitalization of $150 million or less. 
B)  issued by a corporation that has the potential to earn profits above the average profits of all firms in the economy. 
C)  the total amount of securities-stocks and bonds-issued by a corporation. 
D)  follows the business cycle of advances and declines in the economy. 
E)  A safe investment that generally attracts conservative investors

Question 7

A small-cap stock is a stock issued by a company that has capitalization of $150 million or less.

Accepted Answer

A) True 
 B)False

Question 8

Typically, growth companies pay out ____________ of their earnings in dividends to their stockholders.

Accepted Answer

A)  over 95 percent 
B)  between 65 percent and 75 percent 
C)  between 50 and 65 percent 
D)  between 30 and 50 percent 
E)  less than 30 percent 
A)  over 95 percent 
B)  between 65 percent and 75 percent 
C)  between 50 and 65 percent 
D)  between 30 and 50 percent 
E)  less than 30 percent

Question 9

Devin Scott is looking for an investment that will provide a predictable source of income. With this goal in mind, which of the following industry groups would normally be classified as an industry to invest in for income?

Accepted Answer

A)  public utilities 
B)  electronics 
C)  automobile manufacturing 
D)  steel manufacturing 
E)  paper manufacturing 
A)  public utilities 
B)  electronics 
C)  automobile manufacturing 
D)  steel manufacturing 
E)  paper manufacturing

Question 10

A stock that is issued by a corporation that has a large amount of capitalization is called a(n) ____________ stock.

Accepted Answer

A)  small-cap 
B)  medium-cap 
C)  large-cap 
D)  unlimited-cap 
E)  giant-cap 
A)  small-cap 
B)  medium-cap 
C)  large-cap 
D)  unlimited-cap 
E)  giant-cap

Question 11

A market in which an investor purchases financial securities (via an investment bank or other representative from the issuer of those securities is called the ____________ market.

Accepted Answer

A)  technical 
B)  fundamental 
C)  efficient 
D)  secondary 
E)  primary 
A)  technical 
B)  fundamental 
C)  efficient 
D)  secondary 
E)  primary

Question 12

Preferred stocks are often referred to as "middle" investments.

Accepted Answer

A) True 
 B)False

Question 13

Jamie Presner purchased 100 shares of Bank of Montreal for $86.00 Jamie also paid $50 commission. What was the total purchase price for this transaction?

Accepted Answer

A)  $50.00 
B)  $86.00 
C)  $8,650.00 
D)  $8,289.50 
E)  $860.00 
A)  $50.00 
B)  $86.00 
C)  $8,650.00 
D)  $8,289.50 
E)  $860.00

Question 14

Last year, Hi-Lo Electronics earned $2.50 per share. If the current market value for a share of stock is $55, what is the firm's PE ratio?

Accepted Answer

A)  0.025 
B)  2.5 
C)  22 
D)  55 
E)  It is impossible to calculate a PE ratio with this information. 
A)  0.025 
B)  2.5 
C)  22 
D)  55 
E)  It is impossible to calculate a PE ratio with this information.

Question 15

Cumulative preferred stocks are stocks with unpaid dividends that accumulate and must be paid before any cash dividend is paid to the common shareholders.

Accepted Answer

A) True 
 B)False

Question 16

The type of stock in which stockholders are assured that omitted dividends will be paid to them before other dividends are paid is ____________ stock.

Accepted Answer

A)  cumulative preferred 
B)  convertible preferred 
C)  participating preferred 
D)  common 
E)  callable preferred 
A)  cumulative preferred 
B)  convertible preferred 
C)  participating preferred 
D)  common 
E)  callable preferred

Question 17

The term securities encompass a broad range of investments that include stocks, bonds, mutual funds, options, and commodities.

Accepted Answer

A) True 
 B)False

Question 18

A proxy is a legal form that lists the issues to be decided at a stockholders' meeting and requests that stockholders transfer their voting rights to some individual or individuals.

Accepted Answer

A) True 
 B)False

Question 19

Astrid purchased 100 shares of Royal Bank for $76.00/share. Astrid also paid $29 commission. What was the total purchase price for this transaction?

Accepted Answer

A)  $29.00 
B)  $76.00 
C)  $7,600 
D)  $7,629 
E)  $7,571 
A)  $29.00 
B)  $76.00 
C)  $7,600 
D)  $7,629 
E)  $7,571

Question 20

A stock split is a procedure in which a stockholder's common stock is exchanged for preferred stock.

Accepted Answer

A) True 
 B)False

Describe the steps involved in a typical margin transaction.

To calculate the annual dividend yield, the annual dividend is divided by the stock's

Which of the following is not a true statement?

A stock that remains stable during declines in the economy is called a(n) ____________ stock.

A private corporation is a corporation whose stock is owned by relatively few people and is not traded openly in the stock market.

Capitalization is ___________

A small-cap stock is a stock issued by a company that has capitalization of $150 million or less.

Typically, growth companies pay out ____________ of their earnings in dividends to their stockholders.

Devin Scott is looking for an investment that will provide a predictable source of income. With this goal in mind, which of the following industry groups would normally be classified as an industry to invest in for income?

A stock that is issued by a corporation that has a large amount of capitalization is called a(n) ____________ stock.

A market in which an investor purchases financial securities (via an investment bank or other representative from the issuer of those securities is called the ____________ market.

Preferred stocks are often referred to as "middle" investments.

Jamie Presner purchased 100 shares of Bank of Montreal for $86.00 Jamie also paid $50 commission. What was the total purchase price for this transaction?

Last year, Hi-Lo Electronics earned $2.50 per share. If the current market value for a share of stock is $55, what is the firm's PE ratio?

Cumulative preferred stocks are stocks with unpaid dividends that accumulate and must be paid before any cash dividend is paid to the common shareholders.

The type of stock in which stockholders are assured that omitted dividends will be paid to them before other dividends are paid is ____________ stock.

The term securities encompass a broad range of investments that include stocks, bonds, mutual funds, options, and commodities.

A proxy is a legal form that lists the issues to be decided at a stockholders' meeting and requests that stockholders transfer their voting rights to some individual or individuals.

Astrid purchased 100 shares of Royal Bank for $76.00/share. Astrid also paid $29 commission. What was the total purchase price for this transaction?

A stock split is a procedure in which a stockholder's common stock is exchanged for preferred stock.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

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Exam 11: Investing in Stocks

Describe the steps involved in a typical margin transaction.

To calculate the annual dividend yield, the annual dividend is divided by the stock's

Which of the following is not a true statement?

A stock that remains stable during declines in the economy is called a(n) ____________ stock.

A private corporation is a corporation whose stock is owned by relatively few people and is not traded openly in the stock market.

Capitalization is ___________

A small-cap stock is a stock issued by a company that has capitalization of $150 million or less.

Typically, growth companies pay out ____________ of their earnings in dividends to their stockholders.

Devin Scott is looking for an investment that will provide a predictable source of income. With this goal in mind, which of the following industry groups would normally be classified as an industry to invest in for income?

A stock that is issued by a corporation that has a large amount of capitalization is called a(n) ____________ stock.

A market in which an investor purchases financial securities (via an investment bank or other representative from the issuer of those securities is called the ____________ market.

Preferred stocks are often referred to as "middle" investments.

Jamie Presner purchased 100 shares of Bank of Montreal for $86.00 Jamie also paid $50 commission. What was the total purchase price for this transaction?

Last year, Hi-Lo Electronics earned $2.50 per share. If the current market value for a share of stock is $55, what is the firm's PE ratio?

Cumulative preferred stocks are stocks with unpaid dividends that accumulate and must be paid before any cash dividend is paid to the common shareholders.

The type of stock in which stockholders are assured that omitted dividends will be paid to them before other dividends are paid is ____________ stock.

The term securities encompass a broad range of investments that include stocks, bonds, mutual funds, options, and commodities.

A proxy is a legal form that lists the issues to be decided at a stockholders' meeting and requests that stockholders transfer their voting rights to some individual or individuals.

Astrid purchased 100 shares of Royal Bank for $76.00/share. Astrid also paid $29 commission. What was the total purchase price for this transaction?

A stock split is a procedure in which a stockholder's common stock is exchanged for preferred stock.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

The Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source Credit: the Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Bonds

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters