Question 1

Equity-income funds emphasize capital appreciation in their investment goals.

Accepted Answer

A) True 
 B)False  False

Question 2

The major advantage of mutual funds to the small investor is

Accepted Answer

A)  diversification. 
B)  professional management. 
C)  low cost. 
D)  convenience. 
E)  liquidity. 
A)  diversification. 
B)  professional management. 
C)  low cost. 
D)  convenience. 
E)  liquidity. A

Question 3

The most important advantage of a mutual fund is pooled diversification.

Accepted Answer

A) True 
 B)False  True

Question 4

All no load funds charge an upfront fee to purchase shares of a mutual fund.

Accepted Answer

A) True 
 B)False

Question 5

Advantages of exchange traded funds over mutual funds include all of the following except

Accepted Answer

A)  narrow geographic region 
B)  single foreign countries 
C)  better diversification 
D)  industry focus 
E)  sector focus 
A)  narrow geographic region 
B)  single foreign countries 
C)  better diversification 
D)  industry focus 
E)  sector focus

Question 6

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-You could drop an automatic investment plan [at any time | only by fulfilling the original agreement].

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

Dividend income and capital gains distributions are taxed at identical tax rates.

Accepted Answer

A) True 
 B)False

Question 8

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Index funds,while trying to match market performance,consistently [perform well | perform poorly] against market benchmarks.

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 technology fund is an example of a sector fund.

Accepted Answer

A) True 
 B)False

Question 10

The major benefit to small investors of mutual funds is diversification.

Accepted Answer

A) True 
 B)False

Question 11

A real estate investment trust that invests only in mortgages is called an equity trust.

Accepted Answer

A) True 
 B)False

Question 12

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Advantages of exchange traded funds over mutual funds include [lower | higher] expense ratio.

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 13

Closed end mutual funds companies buy their shares back from investors at NAV.

Accepted Answer

A) True 
 B)False

Question 14

In the Wall Street Journal's listing of mutual funds,a "p" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.

Accepted Answer

A)  front-end load 
B)  back-end load 
C)  12b-1 fee 
D)  management fee 
E)  none of the above 
A)  front-end load 
B)  back-end load 
C)  12b-1 fee 
D)  management fee 
E)  none of the above

Question 15

The individual manager of a mutual fund has little to do with a fund's success.

Accepted Answer

A) True 
 B)False

Question 16

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-You could discover the actual fees charged by your mutual fund in the [daily Wall Street Journal | fund prospectus].

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 17

The net asset value (NAV)per share is found by dividing the market value of the fund's securities less the fund's liabilities by the number of shares outstanding.

Accepted Answer

A) True 
 B)False

Question 18

For most investors,the best way to deal in foreign securities is through an international mutual fund.

Accepted Answer

A) True 
 B)False

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Value funds look for stocks with relatively [high | low] P/E ratios.

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

RACE Mutual fund is a no-load fund that had a net asset value one year ago of $25.60.Today the NAV is $28.83.During the year dividends of $0.72 were paid out and a capital gains distribution of $0.65 was made.Calculate the approximate yield for RACE.

Accepted Answer

The answer of RACE Mutual fund is a no-load fund...

Equity-income funds emphasize capital appreciation in their investment goals.

The major advantage of mutual funds to the small investor is

The most important advantage of a mutual fund is pooled diversification.

All no load funds charge an upfront fee to purchase shares of a mutual fund.

Advantages of exchange traded funds over mutual funds include all of the following except

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -You could drop an automatic investment plan [at any time | only by fulfilling the original agreement].

Dividend income and capital gains distributions are taxed at identical tax rates.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Index funds,while trying to match market performance,consistently [perform well | perform poorly] against market benchmarks.

A technology fund is an example of a sector fund.

The major benefit to small investors of mutual funds is diversification.

A real estate investment trust that invests only in mortgages is called an equity trust.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Advantages of exchange traded funds over mutual funds include [lower | higher] expense ratio.

Closed end mutual funds companies buy their shares back from investors at NAV.

In the Wall Street Journal's listing of mutual funds,a "p" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.

The individual manager of a mutual fund has little to do with a fund's success.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -You could discover the actual fees charged by your mutual fund in the [daily Wall Street Journal | fund prospectus].

The net asset value (NAV)per share is found by dividing the market value of the fund's securities less the fund's liabilities by the number of shares outstanding.

For most investors,the best way to deal in foreign securities is through an international mutual fund.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Value funds look for stocks with relatively [high | low] P/E ratios.

RACE Mutual fund is a no-load fund that had a net asset value one year ago of $25.60.Today the NAV is $28.83.During the year dividends of $0.72 were paid out and a capital gains distribution of $0.65 was made.Calculate the approximate yield for RACE.

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

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters

Exam 13: Investing in Mutual Funds

Equity-income funds emphasize capital appreciation in their investment goals.

The major advantage of mutual funds to the small investor is

The most important advantage of a mutual fund is pooled diversification.

All no load funds charge an upfront fee to purchase shares of a mutual fund.

Advantages of exchange traded funds over mutual funds include all of the following except

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -You could drop an automatic investment plan [at any time | only by fulfilling the original agreement].

Dividend income and capital gains distributions are taxed at identical tax rates.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Index funds,while trying to match market performance,consistently [perform well | perform poorly] against market benchmarks.

A technology fund is an example of a sector fund.

The major benefit to small investors of mutual funds is diversification.

A real estate investment trust that invests only in mortgages is called an equity trust.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Advantages of exchange traded funds over mutual funds include [lower | higher] expense ratio.

Closed end mutual funds companies buy their shares back from investors at NAV.

In the Wall Street Journal's listing of mutual funds,a "p" after the mutual fund name and before the NAV means that the particular mutual fund has a ____ associated with it.

The individual manager of a mutual fund has little to do with a fund's success.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -You could discover the actual fees charged by your mutual fund in the [daily Wall Street Journal | fund prospectus].

The net asset value (NAV)per share is found by dividing the market value of the fund's securities less the fund's liabilities by the number of shares outstanding.

For most investors,the best way to deal in foreign securities is through an international mutual fund.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Value funds look for stocks with relatively [high | low] P/E ratios.

RACE Mutual fund is a no-load fund that had a net asset value one year ago of $25.60.Today the NAV is $28.83.During the year dividends of $0.72 were paid out and a capital gains distribution of $0.65 was made.Calculate the approximate yield for RACE.

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

Investment Planning

Investing in Stocks and Bonds

Planning for Retirement

Preserving Your Estate

Filters