Question 1

After retirement, Hector began a search for a low-risk investment. He should consider buying a secured bond of a major corporation.

Accepted Answer

A) True 
 B)False

Question 2

Preferred stockholders receive dividend payments before common stockholders are paid any dividends.

Accepted Answer

A) True 
 B)False

Question 3

We calculate the mutual fund's NAV (Net Asset Value) by dividing the total market value of the fund, by the number of shared outstanding.

Accepted Answer

A) True 
 B)False

Question 4

One criticism of the Dow Jones Industrial Average suggests that it:

Accepted Answer

A)   magnifies the fluctuations in the stock market.
B)   does not indicate the cause of changes in stock prices.
C)   is too small (too few companies)  to get a good statistical representation.
D)   is biased causing an overstatement of bond price increases and an understatement of stock price decreases.E) B) and C)
F) A) and D)

Question 5

Moody's Investor Service currently rates the Sasha Deal Corporation bonds as a C grade. This indicates that these bonds are:

Accepted Answer

A)   of the highest quality with lowest default risk.
B)   moderately speculative.
C)   corporate bonds with variable interest rates.
D)   the lowest quality and the highest risk.E) None of the above
F) A) and B)

Question 6

The corporate certificate issued to an investor that has loaned money to the corporation or government is called a:

Accepted Answer

A)   common stock.
B)   preferred stock.
C)   bond.
D)   debt document.E) C) and D)
F) B) and C)

Question 7

Diversification means buying several different types of investments with the funds you have available for investment.

Accepted Answer

A) True 
 B)False

Question 8

Greg purchased 2,000 shares of common stock of the Rite Track Corporation last year. He learned several months later that the stock does not pay a dividend. Greg should proceed to:

Accepted Answer

A)   hire an attorney and file a lawsuit.
B)   hire an attorney and go after the registered representative that brokered the trade.
C)   do the proper research before he invests.
D)   immediately proceed to sell the shares.E) A) and B)
F) All of the above

Question 9

Which of the following is not an important criterion to consider before investing?

Accepted Answer

A)   Exchange where the company offering the investment is traded
B)   The riskiness of the investment
C)   The duration of the investment
D)   The expected rate of return on the investmentE) None of the above
F) A) and B)

Question 10

A bond offering description reads: "6s of 2015." This means the bond pays 3% interest semi-annually and matures in 2015.

Accepted Answer

A) True 
 B)False

Exam 19: Using Securities Markets for Financing and Investing Opportunities

One criticism of the Dow Jones Industrial Average suggests that it:

Correct Answer
verified

Which of the following is not an important criterion to consider before investing?

Correct Answer
verified

A bond offering description reads: "6s of 2015." This means the bond pays 3% interest semi-annually and matures in 2015.

Correct Answer
verified

Moody's Investor Service currently rates the Sasha Deal Corporation bonds as a C grade. This indicates that these bonds are:

Correct Answer
verified

Diversification means buying several different types of investments with the funds you have available for investment.

Correct Answer
verified

The corporate certificate issued to an investor that has loaned money to the corporation or government is called a:

Correct Answer
verified

Greg purchased 2,000 shares of common stock of the Rite Track Corporation last year. He learned several months later that the stock does not pay a dividend. Greg should proceed to:

Correct Answer
verified

After retirement, Hector began a search for a low-risk investment. He should consider buying a secured bond of a major corporation.

Correct Answer
verified

Preferred stockholders receive dividend payments before common stockholders are paid any dividends.

Correct Answer
verified

We calculate the mutual fund's NAV (Net Asset Value) by dividing the total market value of the fund, by the number of shared outstanding.

Correct Answer
verified

Exam 19: Using Securities Markets for Financing and Investing Opportunities

One criticism of the Dow Jones Industrial Average suggests that it:

Correct AnswerverifiedShow Answer

Which of the following is not an important criterion to consider before investing?

Correct AnswerverifiedShow Answer

A bond offering description reads: "6s of 2015." This means the bond pays 3% interest semi-annually and matures in 2015.

Correct AnswerverifiedShow Answer

Moody's Investor Service currently rates the Sasha Deal Corporation bonds as a C grade. This indicates that these bonds are:

Correct AnswerverifiedShow Answer

Diversification means buying several different types of investments with the funds you have available for investment.

Correct AnswerverifiedShow Answer

The corporate certificate issued to an investor that has loaned money to the corporation or government is called a:

Correct AnswerverifiedShow Answer

Greg purchased 2,000 shares of common stock of the Rite Track Corporation last year. He learned several months later that the stock does not pay a dividend. Greg should proceed to:

Correct AnswerverifiedShow Answer

After retirement, Hector began a search for a low-risk investment. He should consider buying a secured bond of a major corporation.

Correct AnswerverifiedShow Answer

Preferred stockholders receive dividend payments before common stockholders are paid any dividends.

Correct AnswerverifiedShow Answer

We calculate the mutual fund's NAV (Net Asset Value) by dividing the total market value of the fund, by the number of shared outstanding.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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