Question 1

A blue-chip stock is a safe investment that generally attracts conservative investors.

Accepted Answer

A) True 
 B)False

Question 2

Most speculators use a buy and hold technique.

Accepted Answer

A) True 
 B)False

Question 3

The federal government requires corporations selling new issues of securities to disclose information about corporate earnings, assets and liabilities, products or services, and the qualifications of top management in a prospectus.

Accepted Answer

A) True 
 B)False

Question 4

Laws which are enforced by a federal regulatory body for the securities industry have been put in place to protect investors.

Accepted Answer

A) True 
 B)False

Question 5

By using the Canada.Com Finance Web site, an investor can find information on all of the following except

Accepted Answer

A)  inside information. 
B)  the corporation's stock symbol. 
C)  current market values. 
D)  research information. 
E)  historical market quotes. 
A)  inside information. 
B)  the corporation's stock symbol. 
C)  current market values. 
D)  research information. 
E)  historical market quotes.

Question 6

Corporations issue preferred stock because it provides an alternative to financing through corporate bonds or common stock.

Accepted Answer

A) True 
 B)False

Question 7

The term churning is to describe the excessive buying and selling of securities to generate commissions.

Accepted Answer

A) True 
 B)False

Question 8

A long-term investment technique used by investors to purchase stock without paying a commission to a broker is called

Accepted Answer

A)  dollar cost appreciation. 
B)  direct investment plan. 
C)  unregulated transaction. 
D)  regulated transaction. 
E)  over-the-counter transaction. 
A)  dollar cost appreciation. 
B)  direct investment plan. 
C)  unregulated transaction. 
D)  regulated transaction. 
E)  over-the-counter transaction.

Question 9

Ammar purchased 100 shares of Northern Bank at $55 dollars a share in January of 2004. The shares subsequently split two-for-one on December 31, 2004 after paying an annual dividend of $1.00 per share. If Ammar sells all of his shares on the first trading day in January 2005 for $30 each, what has been his return on investment?

Accepted Answer

A)  Zero 
B)  9.1% 
C)  10.0% 
D)  10.9% 
E)  15% 
A)  Zero 
B)  9.1% 
C)  10.0% 
D)  10.9% 
E)  15%

Question 10

When a corporation exchanges stock for a specified amount of money, it is exercising its ____________ feature.

Accepted Answer

A)  participating 
B)  cumulative 
C)  convertible 
D)  call 
E)  termination 
A)  participating 
B)  cumulative 
C)  convertible 
D)  call 
E)  termination

Question 11

When the board of directors approves a two for one stock split, the price for each share of stock

Accepted Answer

A)  remains unchanged. 
B)  increases in value. 
C)  decreases in value. 
D)  is guaranteed to go up within a short period of time. 
E)  always drops to half of its former value. 
A)  remains unchanged. 
B)  increases in value. 
C)  decreases in value. 
D)  is guaranteed to go up within a short period of time. 
E)  always drops to half of its former value.

Question 12

A very safe investment that generally attracts conservative investors is called a(n) ____________ stock.

Accepted Answer

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

Question 13

When the board of directors approves a three for one stock split, the price for each share of stock

Accepted Answer

A)  remains unchanged. 
B)  increases in value. 
C)  decreases in value. 
D)  is guaranteed to go up within a short period of time. 
E)  always drops to a third of its former value. 
A)  remains unchanged. 
B)  increases in value. 
C)  decreases in value. 
D)  is guaranteed to go up within a short period of time. 
E)  always drops to a third of its former value.

Question 14

The record date is the date that the actual dividend payment is made to stockholders.

Accepted Answer

A) True 
 B)False

Question 15

A public 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 16

Dividends are paid out of profits, and

Accepted Answer

A)  dividends are guaranteed. 
B)  dividend payments must be approved by the firm's board of directors. 
C)  dividends are paid before a firm's taxes are paid. 
D)  dividends are usually paid twice a year. 
E)  dividends are guaranteed and paid twice a year. 
A)  dividends are guaranteed. 
B)  dividend payments must be approved by the firm's board of directors. 
C)  dividends are paid before a firm's taxes are paid. 
D)  dividends are usually paid twice a year. 
E)  dividends are guaranteed and paid twice a year.

Question 17

A small-cap stock is defined as a corporation that has total capitalization of

Accepted Answer

A)  more than $250 million. 
B)  less than $150 million. 
C)  less than $175 million. 
D)  less than $200 million. 
E)  no capitalization. 
A)  more than $250 million. 
B)  less than $150 million. 
C)  less than $175 million. 
D)  less than $200 million. 
E)  no capitalization.

Question 18

Which of these is not a sign for potential online investment scams?

Accepted Answer

A)  high pressure tactics to buy from people you do not know 
B)  promises of high profits and sales relating to products of a new company 
C)  large-cap companies that pay a generous executive salary 
D)  reverse splits 
E)  small-cap companies investing in projects unrelated to their businesses 
A)  high pressure tactics to buy from people you do not know 
B)  promises of high profits and sales relating to products of a new company 
C)  large-cap companies that pay a generous executive salary 
D)  reverse splits 
E)  small-cap companies investing in projects unrelated to their businesses

Question 19

One hundred shares or a multiple of 100 shares is called a(n) ____________ lot.

Accepted Answer

A)  market 
B)  limited 
C)  round 
D)  odd 
E)  executive 
A)  market 
B)  limited 
C)  round 
D)  odd 
E)  executive

Question 20

The price earnings ratio is a corporation's after-tax earnings divided by the corporation's earnings per share of stock outstanding over the last 12 months.

Accepted Answer

A) True 
 B)False

A blue-chip stock is a safe investment that generally attracts conservative investors.

Most speculators use a buy and hold technique.

The federal government requires corporations selling new issues of securities to disclose information about corporate earnings, assets and liabilities, products or services, and the qualifications of top management in a prospectus.

Laws which are enforced by a federal regulatory body for the securities industry have been put in place to protect investors.

By using the Canada.Com Finance Web site, an investor can find information on all of the following except

Corporations issue preferred stock because it provides an alternative to financing through corporate bonds or common stock.

The term churning is to describe the excessive buying and selling of securities to generate commissions.

A long-term investment technique used by investors to purchase stock without paying a commission to a broker is called

When a corporation exchanges stock for a specified amount of money, it is exercising its ____________ feature.

When the board of directors approves a two for one stock split, the price for each share of stock

A very safe investment that generally attracts conservative investors is called a(n) ____________ stock.

When the board of directors approves a three for one stock split, the price for each share of stock

The record date is the date that the actual dividend payment is made to stockholders.

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

Dividends are paid out of profits, and

A small-cap stock is defined as a corporation that has total capitalization of

Which of these is not a sign for potential online investment scams?

One hundred shares or a multiple of 100 shares is called a(n) ____________ lot.

The price earnings ratio is a corporation's after-tax earnings divided by the corporation's earnings per share of stock outstanding over the last 12 months.

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

Exam 11: Investing in Stocks

A blue-chip stock is a safe investment that generally attracts conservative investors.

Most speculators use a buy and hold technique.

The federal government requires corporations selling new issues of securities to disclose information about corporate earnings, assets and liabilities, products or services, and the qualifications of top management in a prospectus.

Laws which are enforced by a federal regulatory body for the securities industry have been put in place to protect investors.

By using the Canada.Com Finance Web site, an investor can find information on all of the following except

Corporations issue preferred stock because it provides an alternative to financing through corporate bonds or common stock.

The term churning is to describe the excessive buying and selling of securities to generate commissions.

A long-term investment technique used by investors to purchase stock without paying a commission to a broker is called

When a corporation exchanges stock for a specified amount of money, it is exercising its ____________ feature.

When the board of directors approves a two for one stock split, the price for each share of stock

A very safe investment that generally attracts conservative investors is called a(n) ____________ stock.

When the board of directors approves a three for one stock split, the price for each share of stock

The record date is the date that the actual dividend payment is made to stockholders.

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

Dividends are paid out of profits, and

A small-cap stock is defined as a corporation that has total capitalization of

Which of these is not a sign for potential online investment scams?

One hundred shares or a multiple of 100 shares is called a(n) ____________ lot.

The price earnings ratio is a corporation's after-tax earnings divided by the corporation's earnings per share of stock outstanding over the last 12 months.

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