A share of preferred stock that pays the same annual dividend forever is an example of a perpetuity. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Which statement below is false with respect to your investment style in a 401(k) plan? A) Be ultra-conservative, select fixed-income annuities. B) Be conservative, select money market funds. C) Be somewhat aggressive, particularly if you are a young person with a long investment horizon. D) Be ultra-aggressive, select risky investments and frequently time the markets. […]
Date: September 19th, 2020
Simpson Industries Inc. bonds currently have 12 years remaining to maturity. What is the current price of the firm’s semi-annual bonds if they carry a face value of $1,000, an annual coupon rate of 8% and an annual yield to maturity of 7%? A) $924.64 B) $1,000.00 C) $1,079.43 D) $1,080.29 ANSWER D […]
Date: September 19th, 2020
The surrender value on a life insurance policy is equal to the A) cash value. B) face value. C) amount of death protection. D) cash value plus surrender dividends less outstanding loans and surrender charges. ANSWER D
Date: September 19th, 2020
Cary’s wonderful parents established a college savings plan for him when he was born. They deposited $50 into the account on the last day of each month. The account has earned 10% compounded monthly, tax-free. Now he’s off to State U. What equal amount can they withdraw beginning today (his 18th birthday) and each year […]
Date: September 19th, 2020
Coordinating investments in a 401(k) plan with investments outside the plan usually A) involves selecting high current-return assets in plan with growth assets outside. B) involves selecting growth assets in plan with high current return assets outside. C) dictates the same proportion of growth assets to high-income assets, both in and out of plan. D) […]
Date: September 19th, 2020
If you have been denied credit, you have the right to receive a free copy of your credit report. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
You discover an antique in your attic that you purchased at an estate sale 10 years ago for $400. You auction it on eBay and receive $8,000 for your item. What annual rate of return did you earn? A) 200.00% B) 30.47% C) 34.93% D) 20.00% ANSWER C
Date: September 19th, 2020
Which of the following is an example of “pure risk”? A) The risk associated with holding a portfolio of stocks and bonds B) The risk associated with a bet on a horse race C) The risk associated with a change in careers D) The risk associated with fire and theft ANSWER D
Date: September 19th, 2020
A contingent beneficiary A) will always share in the insurance pay-out. B) will share in the insurance pay-out only if he or she satisfies certain conditions set out in the will. C) will share in the insurance pay-out only if the primary beneficiary is not alive. D) will share in the insurance pay-out only if […]
Date: September 19th, 2020
