Question 1

Specialists maintain a fair and orderly market by buying and selling stock from their inventory to keep the market from fluctuating more than it would otherwise.

Accepted Answer

A) True 
 B)False

Question 2

Historical rates of return for the last 82 years place ________ at the highest end of the spectrum for risk and ________ at the lowest end for risk.

Accepted Answer

A) common stocks;T-Bills 
B) common stocks;long-term government bonds 
C) common stocks;long-term corporate bonds 
D) long-term corporate bonds;long-term government bonds 
A) common stocks;T-Bills 
B) common stocks;long-term government bonds 
C) common stocks;long-term corporate bonds 
D) long-term corporate bonds;long-term government bonds

Question 3

When you sell stock short,you must put up some collateral.

Accepted Answer

A) True 
 B)False

Question 4

A young investor who is averse to risk should invest their money in government bonds.

Accepted Answer

A) True 
 B)False

Question 5

An option gives you the right to buy or sell the underlying asset at a set price on or before the option's maturity date.

Accepted Answer

A) True 
 B)False

Question 6

There are several sources of information available to help you make intelligent choices about buying and selling stock? If you choose a corporation's annual report to base your decisions on,what should you look for?

Accepted Answer

Remember that an annual report is writte

Question 7

Securities include both ________ and ________.

Accepted Answer

A) stocks;mutual funds 
B) bonds;mutual funds 
C) real estate;stocks 
D) stocks;bonds 
E) bonds;money market funds 
A) stocks;mutual funds 
B) bonds;mutual funds 
C) real estate;stocks 
D) stocks;bonds 
E) bonds;money market funds

Question 8

What makes up the interest rate risk?

Accepted Answer

The inflation risk premium is the rate i

Question 9

Alice just inherited an antique wood burning stove.While she appreciates the sentimental value of the stove she is concerned that an investment such as this might not be able to be converted into cash quickly at a fair market price.Alice is worried about ________ on this as an investment.

Accepted Answer

A) liquidity risk 
B) cash conversion 
C) maturity risk 
D) default risk 
E) none of the above 
A) liquidity risk 
B) cash conversion 
C) maturity risk 
D) default risk 
E) none of the above

Question 10

________ are a type of speculating ,while ________ are a type of investing.

Accepted Answer

A) Stocks;options 
B) Real estate;options 
C) Options;stocks 
D) Stocks;baseball trading cards 
A) Stocks;options 
B) Real estate;options 
C) Options;stocks 
D) Stocks;baseball trading cards

Question 11

You recently purchased a stock for $30.It is now worth $40,and it paid a $5 dividend during the time you held it.Your rate of return on this stock is closest to which of the following?

Accepted Answer

A) 67% 
B) 50% 
C) 38% 
D) 33% 
E) 17% 
A) 67% 
B) 50% 
C) 38% 
D) 33% 
E) 17%

Question 12

Herd behavior

Accepted Answer

A) is a kind of self-fulfilling behavior. 
B) involves emotions of fearing regret and seeking pride. 
C) is exemplified when investors take higher risks with profits than they would normally take. 
D) all of the above. 
A) is a kind of self-fulfilling behavior. 
B) involves emotions of fearing regret and seeking pride. 
C) is exemplified when investors take higher risks with profits than they would normally take. 
D) all of the above.

Question 13

The "ask" price should always be ________ the "bid" price.

Accepted Answer

A) below 
B) equal 
C) near 
D) above 
A) below 
B) equal 
C) near 
D) above

Question 14

If you earned a negative 5% return on your investments while the overall stock market was down 9% then you have outperformed the market.

Accepted Answer

A) True 
 B)False

Question 15

A discount broker executes trades but does not provide much advice.

Accepted Answer

A) True 
 B)False

Question 16

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

Accepted Answer

A) FDIC 
B) FSLIC 
C) NCUA 
D) SIPC 
E) FTC 
A) FDIC 
B) FSLIC 
C) NCUA 
D) SIPC 
E) FTC

Question 17

According to the Love & Money section,on average,how long does it take Americans to recover financially from a divorce?

Accepted Answer

A) 10 years 
B) 5 years 
C) 2 years 
D) 6 months 
A) 10 years 
B) 5 years 
C) 2 years 
D) 6 months

Question 18

Suppose that you purchased a machine several years ago for your company.You recently sold the machine for more than you paid.This is an example of a

Accepted Answer

A) capital carry-forward. 
B) non-taxable gain. 
C) capital gain. 
D) windfall. 
E) none of the above. 
A) capital carry-forward. 
B) non-taxable gain. 
C) capital gain. 
D) windfall. 
E) none of the above.

Question 19

What is an advantage to being a "preferred" stock holder?

Accepted Answer

A) Preferred stock holders always get to vote for the board of directors of the company. 
B) Preferred stock holders receive a better coupon interest rate. 
C) Preferred stock holders receive dividend payouts before common stock holders do. 
D) Preferred stock holders never pay commissions on their stock trades. 
E) There are no advantages to being a preferred stock holder. 
A) Preferred stock holders always get to vote for the board of directors of the company. 
B) Preferred stock holders receive a better coupon interest rate. 
C) Preferred stock holders receive dividend payouts before common stock holders do. 
D) Preferred stock holders never pay commissions on their stock trades. 
E) There are no advantages to being a preferred stock holder.

Question 20

When an individual investor sells their shares on the OTC,the price at which they are willing to sell is called the bid price.

Accepted Answer

A) True 
 B)False

Specialists maintain a fair and orderly market by buying and selling stock from their inventory to keep the market from fluctuating more than it would otherwise.

Historical rates of return for the last 82 years place at the highest end of the spectrum for risk and at the lowest end for risk.

When you sell stock short,you must put up some collateral.

A young investor who is averse to risk should invest their money in government bonds.

An option gives you the right to buy or sell the underlying asset at a set price on or before the option's maturity date.

There are several sources of information available to help you make intelligent choices about buying and selling stock? If you choose a corporation's annual report to base your decisions on,what should you look for?

Securities include both and .

What makes up the interest rate risk?

Alice just inherited an antique wood burning stove.While she appreciates the sentimental value of the stove she is concerned that an investment such as this might not be able to be converted into cash quickly at a fair market price.Alice is worried about ________ on this as an investment.

are a type of speculating ,while are a type of investing.

You recently purchased a stock for $30.It is now worth $40,and it paid a $5 dividend during the time you held it.Your rate of return on this stock is closest to which of the following?

Herd behavior

The "ask" price should always be ________ the "bid" price.

If you earned a negative 5% return on your investments while the overall stock market was down 9% then you have outperformed the market.

A discount broker executes trades but does not provide much advice.

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

According to the Love & Money section,on average,how long does it take Americans to recover financially from a divorce?

Suppose that you purchased a machine several years ago for your company.You recently sold the machine for more than you paid.This is an example of a

What is an advantage to being a "preferred" stock holder?

When an individual investor sells their shares on the OTC,the price at which they are willing to sell is called the bid price.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: the Role of Open Credit

Student and Consumer Loans: the Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: an Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Eventsfitting the Pieces Together

Filters

Exam 11: Investment Basics

Specialists maintain a fair and orderly market by buying and selling stock from their inventory to keep the market from fluctuating more than it would otherwise.

Historical rates of return for the last 82 years place ________ at the highest end of the spectrum for risk and ________ at the lowest end for risk.

When you sell stock short,you must put up some collateral.

A young investor who is averse to risk should invest their money in government bonds.

An option gives you the right to buy or sell the underlying asset at a set price on or before the option's maturity date.

There are several sources of information available to help you make intelligent choices about buying and selling stock? If you choose a corporation's annual report to base your decisions on,what should you look for?

Securities include both ________ and ________.

What makes up the interest rate risk?

Alice just inherited an antique wood burning stove.While she appreciates the sentimental value of the stove she is concerned that an investment such as this might not be able to be converted into cash quickly at a fair market price.Alice is worried about ________ on this as an investment.

________ are a type of speculating ,while ________ are a type of investing.

You recently purchased a stock for $30.It is now worth $40,and it paid a $5 dividend during the time you held it.Your rate of return on this stock is closest to which of the following?

Herd behavior

The "ask" price should always be ________ the "bid" price.

If you earned a negative 5% return on your investments while the overall stock market was down 9% then you have outperformed the market.

A discount broker executes trades but does not provide much advice.

You have just recently started your investment activities for retirement.You were happy to learn from your broker that your investor's account balance would be insured for up to $500,000 through the ________ in the event their brokerage firm goes bankrupt.

According to the Love & Money section,on average,how long does it take Americans to recover financially from a divorce?

Suppose that you purchased a machine several years ago for your company.You recently sold the machine for more than you paid.This is an example of a

What is an advantage to being a "preferred" stock holder?

When an individual investor sells their shares on the OTC,the price at which they are willing to sell is called the bid price.

The Financial Planning Process

Measuring Your Financial Health and Making a Plan

Understanding and Appreciating the Time Value of Money

Tax Planning and Strategies

Cash or Liquid Asset Management

Using Credit Cards: the Role of Open Credit

Student and Consumer Loans: the Role of Planned Borrowing

The Home and Automobile Decision

Life and Health Insurance

Property and Liability Insurance

Investing in Stocks

Investing in Bonds and Other Alternatives

Mutual Funds: an Easy Way to Diversify

Retirement Planning

Estate Planning: Saving Your Heirs Money and Headaches

Financial Life Eventsfitting the Pieces Together

Filters

Historical rates of return for the last 82 years place at the highest end of the spectrum for risk and at the lowest end for risk.

Securities include both and .

are a type of speculating ,while are a type of investing.