Question 1

A(n)_____ sells fund shares,either directly to the public or through certain authorized dealers.

Accepted Answer

A)  investment advisor 
B)  custodian 
C)  transfer agent 
D)  distributor 
E)  money manager 
A)  investment advisor 
B)  custodian 
C)  transfer agent 
D)  distributor 
E)  money manager

Question 2

Load fees charged on mutual funds help insure that the fund is well managed and that the investor's yields will be greater than those on no-load funds.

Accepted Answer

A) True 
 B)False

Question 3

Conversion privileges allow investors to exchange one fund's shares for that of another,as long as the funds are in the same fund family.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) True 
 B)False

Question 5

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.
-Advantages of exchange traded funds over mutual funds include [lower | higher] overhead expenses ratio.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 6

Money market funds are traded on the money market,just as closed-end stock funds are traded on the stock market.

Accepted Answer

A) True 
 B)False

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

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 market value of your mutual fund shares will move in the [same | opposite] direction as the market value of the underlying securities.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 9

Most mutual funds allow investors to participate in:

Accepted Answer

A)  automatic reinvestment plans. 
B)  automatic investment plans. 
C)  dividend reinvestment plans. 
D)  a and b above 
E)  a and c above 
A)  automatic reinvestment plans. 
B)  automatic investment plans. 
C)  dividend reinvestment plans. 
D)  a and b above 
E)  a and c above

Question 10

Exchange traded mutual funds are known as closed-end mutual funds.

Accepted Answer

A) True 
 B)False

Question 11

Asset allocation funds invest money in:

Accepted Answer

A)  stocks. 
B)  bonds. 
C)  money market securities. 
D)  a and b only 
E)  all of the above 
A)  stocks. 
B)  bonds. 
C)  money market securities. 
D)  a and b only 
E)  all of the above

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

The difference between the NAV and the offer price represents the commission charge for buying the mutual fund shares.

Accepted Answer

A) True 
 B)False

Question 14

A closed-end investment company that invests in various types of real estate and mortgages is a:

Accepted Answer

A)  hybrid real estate investment trust. 
B)  blind pool syndicate. 
C)  real estate general partnership. 
D)  hybrid limited partnership. 
E)  mortgage real estate investment trust. 
A)  hybrid real estate investment trust. 
B)  blind pool syndicate. 
C)  real estate general partnership. 
D)  hybrid limited partnership. 
E)  mortgage real estate investment trust.

Question 15

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

Accepted Answer

A)  High-yield corporate bond funds 
B)  Municipal bond fund 
C)  Convertible bond fund 
D)  Mortgage-backed bond fund 
E)  All of the above 
A)  High-yield corporate bond funds 
B)  Municipal bond fund 
C)  Convertible bond fund 
D)  Mortgage-backed bond fund 
E)  All of the above

Question 16

The _____ is a service offered by mutual funds that helps an investor earn compound interest on their investments.

Accepted Answer

A)  retirement plan 
B)  automatic withdrawal plan 
C)  automatic reinvestment plan 
D)  conversion privilege 
E)  automatic investment plan 
A)  retirement plan 
B)  automatic withdrawal plan 
C)  automatic reinvestment plan 
D)  conversion privilege 
E)  automatic investment plan

Question 17

Index funds,while trying to match market performance,consistently underperform market benchmarks.

Accepted Answer

A) True 
 B)False

Question 18

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 [custodian | investment advisor] buys and sells the stocks or bonds and otherwise oversees the portfolio.

Accepted Answer

The answer of Choose the word or phrase in [...

Question 19

A no-load fund has no:

Accepted Answer

A)  sales commission. 
B)  transaction fees. 
C)  management charges. 
D)  tax charges. 
E)  12(b)-1 fees. 
A)  sales commission. 
B)  transaction fees. 
C)  management charges. 
D)  tax charges. 
E)  12(b)-1 fees.

Question 20

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

Accepted Answer

A) True 
 B)False

A(n)_____ sells fund shares,either directly to the public or through certain authorized dealers.

Load fees charged on mutual funds help insure that the fund is well managed and that the investor's yields will be greater than those on no-load funds.

Conversion privileges allow investors to exchange one fund's shares for that of another,as long as the funds are in the same fund family.

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

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. -Advantages of exchange traded funds over mutual funds include [lower | higher] overhead expenses ratio.

Money market funds are traded on the money market,just as closed-end stock funds are traded on the stock market.

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

Most mutual funds allow investors to participate in:

Exchange traded mutual funds are known as closed-end mutual funds.

Asset allocation funds invest money in:

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

The difference between the NAV and the offer price represents the commission charge for buying the mutual fund shares.

A closed-end investment company that invests in various types of real estate and mortgages is a:

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

The _____ is a service offered by mutual funds that helps an investor earn compound interest on their investments.

Index funds,while trying to match market performance,consistently underperform market benchmarks.

A no-load fund has no:

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

A(n)_____ sells fund shares,either directly to the public or through certain authorized dealers.

Load fees charged on mutual funds help insure that the fund is well managed and that the investor's yields will be greater than those on no-load funds.

Conversion privileges allow investors to exchange one fund's shares for that of another,as long as the funds are in the same fund family.

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

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. -Advantages of exchange traded funds over mutual funds include [lower | higher] overhead expenses ratio.

Money market funds are traded on the money market,just as closed-end stock funds are traded on the stock market.

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

Most mutual funds allow investors to participate in:

Exchange traded mutual funds are known as closed-end mutual funds.

Asset allocation funds invest money in:

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

The difference between the NAV and the offer price represents the commission charge for buying the mutual fund shares.

A closed-end investment company that invests in various types of real estate and mortgages is a:

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

The _____ is a service offered by mutual funds that helps an investor earn compound interest on their investments.

Index funds,while trying to match market performance,consistently underperform market benchmarks.

A no-load fund has no:

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