QUESTION Which of the following is NOT a benefit of a mutual fund? A) They can be traded by investors at will. B) They are managed by professionals with investment expertise. C) They distribute risk across a variety of securities. D) They offer a wide range of investment strategies. E) They are an economical way […]
Date: September 3rd, 2020
QUESTION What is the difference between a stock’s par value and its market value? What will be an ideal response? ANSWER Answer: The par value of a stock is set by the issuing corporation; it is an arbitrary figure. The market value of a stock is the price it is currently selling for. The […]
Date: September 3rd, 2020
QUESTION Which of the following lists mutual fund types from lowest potential risk to highest potential risk? A) balanced < index < sector < money market B) index < balanced < money market < sector C) money market < index < balanced < sector D) sector < index < balanced < money market E) money […]
Date: September 3rd, 2020
QUESTION What are serial bonds, and what benefit do they offer the issuer? What will be an ideal response? ANSWER Answer: Serial bonds are bonds that mature at different dates. By not maturing at the same time, the issuer does not have to repay the bonds all at once. This helps the issuer avoid […]
Date: September 3rd, 2020
QUESTION Which of the following is NOT a factor to consider when researching potential brokers to help trade securities in a portfolio? A) the fees for executing a trade B) the portfolio performance guarantee C) the minimum account balance requirements D) the speed at which trades are executed E) the available research data and tools […]
Date: September 3rd, 2020
QUESTION Where will you find information on the stock prices of major Japanese-based technology companies? A) Wilshire 5000 Index B) Standard & Poor’s 500 C) Nikkei 225 D) NASDAQ Composite Index E) FTSE 100 ANSWER Answer: C Explanation: C) Stock market indicators are indexes of stock market prices of groups of stocks that are […]
Date: September 3rd, 2020
QUESTION Which of the following trades will be executed in the shortest time after the order is placed? A) a discretionary order to buy 1,000 shares of Sunny Fun Cruise Lines. B) a limit order to sell 100 shares of Sunny Fun Cruise Lines above $8.50 C) a market order to buy 300 shares of […]
Date: September 3rd, 2020
QUESTION Which of the following guides a broker’s decision on executing a limit order for a stock? A) par value B) dividends C) book value D) market value E) interest rate ANSWER Answer: D Explanation: D) Limit orders direct a broker to buy or sell a security when the market price, or market value, […]
Date: September 3rd, 2020
QUESTION Why do investors believe that the S&P 500 offers a more accurate index of stock prices than the Dow? A) It lists more companies. B) It is a composite of U.S. and foreign stocks. C) It changes the stocks listed to represent economic trends. D) It lists stocks of all other U.S. stock market […]
Date: September 3rd, 2020
QUESTION Which industry sector is NOT represented in the Standard & Poor’s 500 index? A) financial B) industrial C) leisure and entertainment D) public utility E) transportation ANSWER Answer: C Explanation: C) The S&P 500 index tracks 400 industrial, 40 financial, 40 public utility, and 20 transportation stocks.
Date: September 3rd, 2020
