Question 1

Once one's asset allocation plan is developed and securities are selected,these decisions do not have to be made again until there is a major life change.

Accepted Answer

A) True 
 B)False

Question 2

A collection of investments is called

Accepted Answer

A)  a letter of exposure. 
B)  a diversification. 
C)  a grouping. 
D)  an envelope. 
E)  a portfolio. 
A)  a letter of exposure. 
B)  a diversification. 
C)  a grouping. 
D)  an envelope. 
E)  a portfolio.

Question 3

Which of the following securities/investment acts regulates the sale of mutual fund shares?

Accepted Answer

A)  The Securities Act of 1933 
B)  the Securities and Exchange Act of 1934 
C)  The Investment Company Act of 1940 
D)  The Sarbanes/Oxley Act of 2002 
E)  The Securities and Protection Act of 1970 
A)  The Securities Act of 1933 
B)  the Securities and Exchange Act of 1934 
C)  The Investment Company Act of 1940 
D)  The Sarbanes/Oxley Act of 2002 
E)  The Securities and Protection Act of 1970

Question 4

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-A convertible bond would let the investor exchange it for [preferred | common] stock.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 5

What was the closing price of Stock C on the previous trading day?

Accepted Answer

A)  $24.00 
B)  $23.63 
C)  $24.32 
D)  $23.00 
E)  Cannot tell from the information given 
A)  $24.00 
B)  $23.63 
C)  $24.32 
D)  $23.00 
E)  Cannot tell from the information given

Question 6

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Asset allocation is another term for [selecting the stocks you want to buy | deciding what percentage of your investment you want in stocks].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 7

In investment terminology,selling stock that you have borrowed is known as a

Accepted Answer

A)  margin sale. 
B)  short sale. 
C)  limit sale. 
D)  stop-loss sale. 
E)  none of these. 
A)  margin sale. 
B)  short sale. 
C)  limit sale. 
D)  stop-loss sale. 
E)  none of these.

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Listed securities would be purchased from [a securities exchange | the over the counter market].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 9

A diversified portfolio should be less risky than putting your money into a single security.

Accepted Answer

A) True 
 B)False

Question 10

A stock portfolio containing 80% common stocks is most likely to be appropriate for

Accepted Answer

A)  a retired couple who needs a high return 
B)  a divorced middle-aged mother who needs a high return 
C)  a blue-collar,two-income family with five kids 
D)  a young single worker putting money aside for retirement 
E)  a portfolio with 80% in common stocks is not suitable for anyone under any circumstances 
A)  a retired couple who needs a high return 
B)  a divorced middle-aged mother who needs a high return 
C)  a blue-collar,two-income family with five kids 
D)  a young single worker putting money aside for retirement 
E)  a portfolio with 80% in common stocks is not suitable for anyone under any circumstances

Question 11

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Publicly traded corporations [are required to | may choose to] provide annual reports to their stockholders.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 12

A bull market is characterized by

Accepted Answer

A)  investor optimism. 
B)  governmental stimulus. 
C)  economic slowdown. 
D)  falling stock prices. 
E)  investor pessimism. 
A)  investor optimism. 
B)  governmental stimulus. 
C)  economic slowdown. 
D)  falling stock prices. 
E)  investor pessimism.

Question 13

Retired people often choose investments offering high current income with high risk.

Accepted Answer

A) True 
 B)False

Question 14

Abe owns 1000 shares of Amazon,which he purchased for $12 per share 3 months ago.Abe just checked the price of Amazon and found that it is selling for $19 per share.He is so excited about his gain that he has booked a $6,000 20-day trip to Hawaii for he and his wife.He wants to be sure that the trip will be paid for entirely from gains in his Amazon shares because his wife has been nagging him about his frequent stock trading habit and he feels that this trip will demonstrate to her once and for all that he has the skills,acumen and instincts to get rich trading stocks.He feels strongly that the price of Amazon stock will go through the roof in the intermediate term but is concerned about short-term volatility.Abe's plan is to sell the shares only if the value of his shares either declines below $18,000 or if the value climbs to $30,000.He would like to submit his stock orders right now,because for the next three weeks it is very important to his marriage that he not trade or even follow the market (maybe just a peek at CNBC while his wife is in the shower).Which of the following set of stock orders would accomplish his pathetic goals?

Accepted Answer

A GTC stop-loss orde

Question 15

An odd lot transaction is generally more expensive than a round lot transaction.

Accepted Answer

A) True 
 B)False

Question 16

Mutual funds provide professional management and diversification that individual investors - especially those with limited resources - can rarely obtain on their own.

Accepted Answer

A) True 
 B)False

Question 17

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-[2,000 | 148,800] shares of ABC stock were traded on this day.

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 18

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The Dow Jones Industrial Average is based on [all stocks traded on the NYSE | 50 large stocks | 30 large stocks].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-An investment offering a high current income would likely be more desirable for [a young couple | a retired couple].

Accepted Answer

A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement. 
A) for the first item 
B) for the second item 
C) if neither item will correctly complete the statement.

Question 20

The major reason most people invest is to shelter current income from taxes.

Accepted Answer

A) True 
 B)False

Once one's asset allocation plan is developed and securities are selected,these decisions do not have to be made again until there is a major life change.

A collection of investments is called

Which of the following securities/investment acts regulates the sale of mutual fund shares?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A convertible bond would let the investor exchange it for [preferred | common] stock.

What was the closing price of Stock C on the previous trading day?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Asset allocation is another term for [selecting the stocks you want to buy | deciding what percentage of your investment you want in stocks].

In investment terminology,selling stock that you have borrowed is known as a

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Listed securities would be purchased from [a securities exchange | the over the counter market].

A diversified portfolio should be less risky than putting your money into a single security.

A stock portfolio containing 80% common stocks is most likely to be appropriate for

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Publicly traded corporations [are required to | may choose to] provide annual reports to their stockholders.

A bull market is characterized by

Retired people often choose investments offering high current income with high risk.

An odd lot transaction is generally more expensive than a round lot transaction.

Mutual funds provide professional management and diversification that individual investors - especially those with limited resources - can rarely obtain on their own.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[2,000 | 148,800] shares of ABC stock were traded on this day.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The Dow Jones Industrial Average is based on [all stocks traded on the NYSE | 50 large stocks | 30 large stocks].

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -An investment offering a high current income would likely be more desirable for [a young couple | a retired couple].

The major reason most people invest is to shelter current income from taxes.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters

Exam 11: Investment Planning

Once one's asset allocation plan is developed and securities are selected,these decisions do not have to be made again until there is a major life change.

A collection of investments is called

Which of the following securities/investment acts regulates the sale of mutual fund shares?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A convertible bond would let the investor exchange it for [preferred | common] stock.

What was the closing price of Stock C on the previous trading day?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Asset allocation is another term for [selecting the stocks you want to buy | deciding what percentage of your investment you want in stocks].

In investment terminology,selling stock that you have borrowed is known as a

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Listed securities would be purchased from [a securities exchange | the over the counter market].

A diversified portfolio should be less risky than putting your money into a single security.

A stock portfolio containing 80% common stocks is most likely to be appropriate for

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Publicly traded corporations [are required to | may choose to] provide annual reports to their stockholders.

A bull market is characterized by

Retired people often choose investments offering high current income with high risk.

An odd lot transaction is generally more expensive than a round lot transaction.

Mutual funds provide professional management and diversification that individual investors - especially those with limited resources - can rarely obtain on their own.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[2,000 | 148,800] shares of ABC stock were traded on this day.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The Dow Jones Industrial Average is based on [all stocks traded on the NYSE | 50 large stocks | 30 large stocks].

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -An investment offering a high current income would likely be more desirable for [a young couple | a retired couple].

The major reason most people invest is to shelter current income from taxes.

Understanding the Financial Planning Process

Using Financial Statements and Budgets

Preparing Your Taxes

Managing Your Cash and Savings

Making Automobile and Housing Decisions

Using Credit

Using Consumer Loans

Insuring Your Life

Insuring Your Health

Protecting Your Property

Investing in Stocks and Bonds

Investing in Mutual Funds

Planning for Retirement

Preserving Your Estate

Filters