Exam 13: Investing in Mutual Funds

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -Individuals would not trade among themselves in [a closed-end | an open-end] investment company.

As of late 2014,housing prices had rebounded from the levels of the housing debacle of 2007-2009.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -You [could | could not] learn in a newspaper whether your fund charged a redemption fee.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -Value funds look for stocks with relatively [high | low] dividend yields.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -Exchange traded funds are investment company shares that trade [at day's close | throughout the day] on stock exchanges.

A fund that invests only in a particular industry would be a _____ fund.

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

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -[Open-end | Closed-end] mutual funds always redeem shares at NAV.

Open-ended mutual funds companies buy their shares back from investors at NAV.

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.

Investment company earnings come from:

Socially responsible funds abstain from investing in alcohol,gambling,or tobacco stocks.

In the Wall Street Journal's listing of mutual funds,a "t" after the mutual fund name and before the NAV means that the particular mutual fund has a _____ associated with it.

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -The actual ownership of a mutual fund is in the hands of the [management company | shareholders].

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

Choose the word or phrase in [ ] which will correctly complete the statement.Select "a" for the first item,"b" for the second item,and "c" if neither item will correctly complete the statement. -A quotation for a mutual fund shows a NAV of $9.60 and an offer price of $10.00.With an investment of $1,000,you could buy [104.17 | 100] shares.

When you buy shares in a no-load fund,you will pay the NAV.

Advantages of exchange traded funds over mutual funds include a broader market focus.

Low-load funds do not charge a commission upon initial purchase.

Investors tend to use mutual funds for which of the following reasons?