Question 1

Growth funds are mutual funds designed for short term investing.

Accepted Answer

A) True 
 B)False

Question 2

Open ended mutual funds typically offer more diversification than an individual security.

Accepted Answer

A) True 
 B)False

Question 3

Aggressive growth funds typically buy stocks with high PE ratios and stocks with volatile price fluctuations.

Accepted Answer

A) True 
 B)False

Question 4

The price per share of a closed-end investment fund could be lower than its NAV.

Accepted Answer

A) True 
 B)False

Question 5

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-[Growth | Equity-income] funds would be more speculative.

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 6

The current market value of all the securities a mutual fund owns is called the

Accepted Answer

A)  market value. 
B)  par value. 
C)  net asset value. 
D)  book value. 
E)  liquidation value. 
A)  market value. 
B)  par value. 
C)  net asset value. 
D)  book value. 
E)  liquidation value.

Question 7

Indexed funds have high realized capital gains.

Accepted Answer

A) True 
 B)False

Question 8

Value funds look for stocks with relatively all the following except

Accepted Answer

A)  high dividend yields 
B)  moderate amounts of leverage 
C)  low P/E ratios 
D)  rapid growth 
E)  undiscovered companies 
A)  high dividend yields 
B)  moderate amounts of leverage 
C)  low P/E ratios 
D)  rapid growth 
E)  undiscovered companies

Question 9

Most mutual funds allow investors to participate in

Accepted Answer

A)  Automatic reinvestment plans 
B)  Automatic investment plans 
C)  DRIP plans 
D)  a and b above 
E)  a and c above 
A)  Automatic reinvestment plans 
B)  Automatic investment plans 
C)  DRIP plans 
D)  a and b above 
E)  a and c above

Question 10

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The actual ownership of a mutual fund is in the hands of the [management company | shareholders].

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 11

Asset allocation funds invest entirely in U.S.and foreign stock and bonds.

Accepted Answer

A) True 
 B)False

Question 12

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-If you choose to have your mutual fund dividends automatically reinvested,you [may defer taxes on the dividends until you redeem some shares | still owe taxes for the year the dividends were earned].

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

A mutual fund's NAV is its

Accepted Answer

A)  normal average value. 
B)  nationally advertized value. 
C)  noted assessment vision. 
D)  net asset value. 
E)  none of these 
A)  normal average value. 
B)  nationally advertized value. 
C)  noted assessment vision. 
D)  net asset value. 
E)  none of these

Question 14

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

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 15

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-The primary reason for investing in mutual funds is [professional management | diversification].

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 16

There are more closed-end investment companies than there are open-end companies.

Accepted Answer

A) True 
 B)False

Question 17

Mutual funds may be classified by the types of securities they purchase.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following bond mutual funds would provide tax-free income?

Accepted Answer

A)  government bond fund 
B)  municipal bond fund 
C)  convertible bond fund 
D)  mortgage-backed bond fund 
E)  all of the above 
A)  government bond fund 
B)  municipal bond fund 
C)  convertible bond fund 
D)  mortgage-backed bond fund 
E)  all of the above

Question 19

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. 
-Individuals would not trade among themselves in [a closed end | an open end] investment 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 20

Global mutual funds can invest both in domestic and international stocks.

Accepted Answer

A) True 
 B)False

Growth funds are mutual funds designed for short term investing.

Open ended mutual funds typically offer more diversification than an individual security.

Aggressive growth funds typically buy stocks with high PE ratios and stocks with volatile price fluctuations.

The price per share of a closed-end investment fund could be lower than its NAV.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Growth | Equity-income] funds would be more speculative.

The current market value of all the securities a mutual fund owns is called the

Indexed funds have high realized capital gains.

Value funds look for stocks with relatively all the following except

Most mutual funds allow investors to participate in

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The actual ownership of a mutual fund is in the hands of the [management company | shareholders].

Asset allocation funds invest entirely in U.S.and foreign stock and bonds.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -If you choose to have your mutual fund dividends automatically reinvested,you [may defer taxes on the dividends until you redeem some shares | still owe taxes for the year the dividends were earned].

A mutual fund's NAV is its

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

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The primary reason for investing in mutual funds is [professional management | diversification].

There are more closed-end investment companies than there are open-end companies.

Mutual funds may be classified by the types of securities they purchase.

Which of the following bond mutual funds would provide tax-free income?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Individuals would not trade among themselves in [a closed end | an open end] investment company.

Global mutual funds can invest both in domestic and international stocks.

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

Growth funds are mutual funds designed for short term investing.

Open ended mutual funds typically offer more diversification than an individual security.

Aggressive growth funds typically buy stocks with high PE ratios and stocks with volatile price fluctuations.

The price per share of a closed-end investment fund could be lower than its NAV.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -[Growth | Equity-income] funds would be more speculative.

The current market value of all the securities a mutual fund owns is called the

Indexed funds have high realized capital gains.

Value funds look for stocks with relatively all the following except

Most mutual funds allow investors to participate in

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The actual ownership of a mutual fund is in the hands of the [management company | shareholders].

Asset allocation funds invest entirely in U.S.and foreign stock and bonds.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -If you choose to have your mutual fund dividends automatically reinvested,you [may defer taxes on the dividends until you redeem some shares | still owe taxes for the year the dividends were earned].

A mutual fund's NAV is its

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

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -The primary reason for investing in mutual funds is [professional management | diversification].

There are more closed-end investment companies than there are open-end companies.

Mutual funds may be classified by the types of securities they purchase.

Which of the following bond mutual funds would provide tax-free income?

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement. -Individuals would not trade among themselves in [a closed end | an open end] investment company.

Global mutual funds can invest both in domestic and international stocks.

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