Question 1

Balanced funds invest in a mix of utility and growth equities.

Accepted Answer

A) True 
 B)False

Question 2

An annual fee charged by some mutual funds to cover marketing and distribution expenses is the

Accepted Answer

A)  management fee. 
B)  back-end load. 
C)  transaction fee. 
D)  12(b)-1 fee. 
E)  low-load. 
A)  management fee. 
B)  back-end load. 
C)  transaction fee. 
D)  12(b)-1 fee. 
E)  low-load.

Question 3

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Exchange-indexed funds are [actively | passively] managed pools of investments.

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 4

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The cost of buying shares in a load fund is [high | low] compared to the commissions charged for buying 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

The approximate yield on a mutual fund depends only on the fund's dividend income and capital gains distributions.

Accepted Answer

A) True 
 B)False

Question 6

The fund whose main objective is to simply match the market known as a(n)____ fund.

Accepted Answer

A)  balanced 
B)  preferred stock 
C)  money market 
D)  index 
E)  none of these 
A)  balanced 
B)  preferred stock 
C)  money market 
D)  index 
E)  none of these

Question 7

Value funds typically invest in stocks that do not pay dividends and have a high price/earning ratio.

Accepted Answer

A) True 
 B)False

Question 8

Asset allocation funds invest money in

Accepted Answer

A)  stocks 
B)  bonds 
C)  real estate 
D)  a and b only 
E)  all of the above 
A)  stocks 
B)  bonds 
C)  real estate 
D)  a and b only 
E)  all of the above

Question 9

Balanced funds invest in a proportionate amount of common and preferred stocks and bonds.

Accepted Answer

A) True 
 B)False

Question 10

Investment company earnings result solely from dividends.

Accepted Answer

A) True 
 B)False

Question 11

The price an investor can sell his shares of an open-end mutual fund share is the net asset value.

Accepted Answer

A) True 
 B)False

Question 12

A(n)____ fund invests primarily in a portfolio of common stocks for the income they provide.

Accepted Answer

A)  balanced 
B)  money market 
C)  growth 
D)  sector 
E)  equity-income 
A)  balanced 
B)  money market 
C)  growth 
D)  sector 
E)  equity-income

Question 13

A fund's objective must be stated in its prospectus.

Accepted Answer

A) True 
 B)False

Question 14

Exchange-traded funds have characteristics of both closed-end and open-end funds.

Accepted Answer

A) True 
 B)False

Question 15

Investment company earnings come from

Accepted Answer

A)  capital gains. 
B)  dividend from stocks. 
C)  interest from bonds. 
D)  interest and dividends. 
E)  interest,dividends,and capital gains. 
A)  capital gains. 
B)  dividend from stocks. 
C)  interest from bonds. 
D)  interest and dividends. 
E)  interest,dividends,and capital gains.

Question 16

Growth-and-Income funds invest most of their capital in common stocks.

Accepted Answer

A) True 
 B)False

Question 17

Dividend income,capital gains distributions,and changes in the fund's share price are all sources of return for a mutual fund.

Accepted Answer

A) True 
 B)False

Question 18

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

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

Mutual funds may be bought and sold through

Accepted Answer

A)  mutual savings banks and brokerage firms. 
B)  funds salespeople and mutual savings banks. 
C)  brokerage firms and fund salespeople. 
D)  brokerage firms and funds exchange. 
E)  fund exchange and fund salespeople. 
A)  mutual savings banks and brokerage firms. 
B)  funds salespeople and mutual savings banks. 
C)  brokerage firms and fund salespeople. 
D)  brokerage firms and funds exchange. 
E)  fund exchange and fund salespeople.

Question 20

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The NAV would indicate the price at which you could buy shares in a [load | no load] mutual fund.

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.

Balanced funds invest in a mix of utility and growth equities.

An annual fee charged by some mutual funds to cover marketing and distribution expenses is the

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Exchange-indexed funds are [actively | passively] managed pools of investments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The cost of buying shares in a load fund is [high | low] compared to the commissions charged for buying stock.

The approximate yield on a mutual fund depends only on the fund's dividend income and capital gains distributions.

The fund whose main objective is to simply match the market known as a(n)____ fund.

Value funds typically invest in stocks that do not pay dividends and have a high price/earning ratio.

Asset allocation funds invest money in

Balanced funds invest in a proportionate amount of common and preferred stocks and bonds.

Investment company earnings result solely from dividends.

The price an investor can sell his shares of an open-end mutual fund share is the net asset value.

A(n)____ fund invests primarily in a portfolio of common stocks for the income they provide.

A fund's objective must be stated in its prospectus.

Exchange-traded funds have characteristics of both closed-end and open-end funds.

Investment company earnings come from

Growth-and-Income funds invest most of their capital in common stocks.

Dividend income,capital gains distributions,and changes in the fund's share price are all sources of return for a mutual fund.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

Mutual funds may be bought and sold through

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The NAV would indicate the price at which you could buy shares in a [load | no load] mutual fund.

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

Balanced funds invest in a mix of utility and growth equities.

An annual fee charged by some mutual funds to cover marketing and distribution expenses is the

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Exchange-indexed funds are [actively | passively] managed pools of investments.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The cost of buying shares in a load fund is [high | low] compared to the commissions charged for buying stock.

The approximate yield on a mutual fund depends only on the fund's dividend income and capital gains distributions.

The fund whose main objective is to simply match the market known as a(n)____ fund.

Value funds typically invest in stocks that do not pay dividends and have a high price/earning ratio.

Asset allocation funds invest money in

Balanced funds invest in a proportionate amount of common and preferred stocks and bonds.

Investment company earnings result solely from dividends.

The price an investor can sell his shares of an open-end mutual fund share is the net asset value.

A(n)____ fund invests primarily in a portfolio of common stocks for the income they provide.

A fund's objective must be stated in its prospectus.

Exchange-traded funds have characteristics of both closed-end and open-end funds.

Investment company earnings come from

Growth-and-Income funds invest most of their capital in common stocks.

Dividend income,capital gains distributions,and changes in the fund's share price are all sources of return for a mutual fund.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -A no-load mutual fund would most likely be sold by [a broker | calling the mutual fund company].

Mutual funds may be bought and sold through

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The NAV would indicate the price at which you could buy shares in a [load | no load] mutual fund.

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