QUESTION Which of the following lists investment strategies in order from lowest risk to highest risk? A) investing for growth < buying and holding < market timing < investing for income < value investing B) buying and holding < investing for income < investing for growth < value investing < market timing C) value investing […]
QUESTION When the U.S. housing market recovers after the Great Recession and homes are being built at a rapid pace, this will have a direct impact on the price of which commodity? A) gold B) coffee beans C) appliances D) lumber E) gasoline ANSWER Answer: D Explanation: D) In an economic expansion that is […]
QUESTION Which of the following would NOT be traded in a commodities exchange? A) eggs B) silicon chips C) soybean oil D) gold E) wool ANSWER Answer: B Explanation: B) Commodities are raw materials and agricultural goods used to produce other goods.
QUESTION Edna and Stan are both recently retired and need to reallocate their investments. Which of the following is the best portfolio mix to meet their needs? A) 75% growth stocks, 15% blue chip stocks, 10% bonds B) 50% growth stocks, 45% blue chip stocks, 5% cash C) 50% blue chip stocks, 25% bonds, 25% […]
QUESTION Sayed inherited a large sum of money and wants to spread his investment risk. He wants to focus on healthcare companies because it’s a high growth industry. He also prefers to have management fees deducted from his account rather than pay commissions on every purchase. What does Sayed invest in? A) an income load […]
QUESTION What type of securities make up a hybrid mutual fund? A) common stock and preferred stock B) secured bonds and debenture bonds C) stocks and bonds D) alternative energy company and utility stocks E) convertible bonds ANSWER Answer: C Explanation: C) Hybrid funds include both stocks and bonds to help balance risk.
QUESTION In recent years, the Dow Jones Industrial Average has replaced manufacturing companies listed in the index with pharmaceutical and technology companies. Why? A) to open the Dow to foreign companies B) to reflect change in the U.S. economy C) to add more companies selling preferred stock D) to enhance computation of the index E) […]
QUESTION Umeko works in Manhattan, but a little bit of her heart will always be home in Japan. For her retirement plan, she selected a mutual fund that focuses on stocks from the Nikkei 225. What type of fund did Umeko invest in? A) global B) sector C) growth D) index E) socially responsible […]
QUESTION Which of the following would NOT be included in the prospectus for a company’s stock? A) details about the company’s mission B) experience of the company’s top managers C) par value for shares D) past dividends E) call-in date for shares ANSWER Answer: E Explanation: E) Call-in dates are only established for callable […]
QUESTION Which of the following is NOT a correctly paired association? A) sector fund—green energy B) balanced fund—stocks and bonds C) money market fund—common stock D) index fund—Wilshire 5000 E) income fund—dividends ANSWER Answer: C Explanation: C) Money market funds follow a very conservative investment strategy. They invest in bank CDs, commercial paper, and […]
