The documents signed when a customer opens a brokerage account

serve as an informal relationship between the customer and the stockbroker.

limit the customer to dealing only through that brokerage firm.

may be signed by a minor child provided that the money being invested belongs to the child.

establish a legal relationship between the customer and the brokerage firm.

Points Received: 1 of 1

Comments:

Question 2. Question :

Which one of the following is considered a financial rather than a general newspaper?

The New York Times

USA Today

The Wall Street Journal

The Washingtom Post

Points Received: 1 of 1

Comments:

Question 3. Question :

Most brokerage firms will invest surplus cash, dividends and interest received, proceeds from the sale of stock and the like in

additional securities of the same type.

certificates of deposit.

a non-interest bearing account.

a money market mutual fund.

Points Received: 1 of 1

Comments:

Question 4. Question :

Assume that the S&P 500 composite stock index is 995.50. This means that

the average stock in the index is selling for $99.55.

an investor would have to pay $995.50 to purchase one share of each of the stocks represented in the index.

the market values of the stocks in the index increased by a factor of 99.55 since the 1941-1943 base period.

the share prices of the stocks in the index have risen 995.50 times since 1941.

Points Received: 0 of 1

Comments:

Question 5. Question :

Mike bought 200 shares of EG stock two years ago at $16 per share. The stock has traded in a range of $21 to $44 a share over the past year. EG is now selling for $43.60 a share. EG announces its earnings today and Mike feels the stock could go to $60 on good news or fall to $30 on bad. To protect his profits, the most appropriate order for him to place is

market order to sell immediately.

a limit sell order at $60.00.

a stop loss order at $42.

a stop-limit order to sell at $45.

Points Received: 1 of 1

Comments:

Question 6. Question :

Earnings on securities held in street name by the brokerage are not reported to the Internal Revenue Service.

True False

Points Received: 0 of 1

Comments:

Question 7. Question :

The published analysis and recommendations of an individual brokerage firm is called a

prospectus.

comparative data source.

back-office research report.

broker's subscription report.

Points Received: 1 of 1

Comments:

Question 8. Question :

Commission structures vary with the type of security being traded, the type of broker involved and the size of the order.

True False

Points Received: 1 of 1

Comments:

Question 9. Question :

An individual can sort stocks by dividend rates, growth rates, and price/earnings ratios using screening tools on the Internet.

True False

Points Received: 1 of 1

Comments:

Question 10. Question :

Trading stocks is much faster and less complicated if an individual investor has possession of the actual stock certificates.

True False

Points Received: 1 of 1

Comments:

Question 11. Question :

Which one of the following statements about limit orders is ?

The execution of the trade will occur prior to the close of trading on the day the trade is placed.

The execution will occur at the regular open on the day following the day the trade is placed.

The trade may be executed only at the limit price or better at any time prior to expiration or cancellation of the order.

The trade will be executed at the market price at the end of the third business day, if not executed previously at the limit price.

Points Received: 1 of 1

Comments:

Question 12. Question :

Which of the following statements about the Dow Jones Industrial Average are ?

I and III only

II and IV only

I, III and IV only

I, II, III and IV

Points Received: 0 of 1

Comments:

Question 13. Question :

Over-the-counter market activity is reflected in the

Standard & Poor's composite index.

Nasdaq index.

AMEX composite index.

financials index.

Points Received: 1 of 1

Comments:

Question 14. Question :

Traders who hold stocks for less than a full day can reduce the tax burden on their profits.

True False

Points Received: 1 of 1

Comments:

Question 15. Question :

Individuals can use the Internet to

I and IV only

II and III only

I, III and IV only

I, II, III and IV

Points Received: 1 of 1

Comments:

Question 16. Question :

Which of the following designations does not have formal education and testing requirements.

Chartered Financial Analyst

Certified Financial Planner

Registered Investment Adviser

Certified Public Accountant

Points Received: 1 of 1

Comments:

Question 17. Question :

Which one of the following is the LEAST important when selecting a stockbroker?

knowing the stockbroker personally

selecting a stockbroker who best understands your investment goals

considering the services offered and the related costs

getting referrals from personal acquaintances with similar investment objectives

Points Received: 1 of 1

Comments:

Question 18. Question :

An individual investor who wishes to borrow money to buy stocks must open a

signature account.

margin account.

joint account.

custodial account.

Points Received: 1 of 1

Comments:

Question 19. Question :

Investors are protected from market losses by the SIPC insurance offered by some full-service brokers.

True False

Points Received: 0 of 1

Comments:

Question 20. Question :

The Internet provides

II and III only

III and IV only

I, II and III only

I, II, III and IV

Points Received: 1 of 1

Comments:

Question 21. Question :

Which one of the following is a measure of the performance of small companies?

Russell 2000

Russell 1000

Russell 3000

Value Line 1700

Points Received: 1 of 1

Comments:

Question 22. Question :

A "pump and dump" scheme involves buying shares of stock, hyping that stock via the Internet and then quickly selling the shares at a profit.

True False

Points Received: 1 of 1

Comments:

Question 23. Question :

Many brokerage firms require that disputes between individual investors and brokers be settled through arbitration.

True False

Points Received: 1 of 1

Comments:

Question 24. Question :

The Dow Jones Industrial Average (DJIA) consists of 30 stocks whose price behavior

typically has little correlation with the rest of the stock market.

broadly reflects the overall price behavior of the stock market.

reflects the changes in value of manufacturing stocks only.

leads the movements in the general economy by one to two weeks.

Points Received: 1 of 1

Comments:

Question 25. Question :

Which of the following sites is especially valuable for information concerning international investments?

http://yahoo.finance.com

www.adr.com

www.moody's.com

www.bondsonline.com

Points Received: 1 of 1

Comments:

Question 26. Question :

A stop-loss order is activated once the stock reaches the specified price.

True False

Points Received: 1 of 1

Comments:

Question 27. Question :

Which one of the following web sites should you utilize to review the financial information in a company's 10-K report?

freeedgar.com

valueline.com

wsj.com

finance.yahoo.com

Points Received: 1 of 1

Comments:

Question 28. Question :

It is generally a good idea to use limit orders when purchasing IPOs on-line.

True False

Points Received: 1 of 1

Comments:

Question 29. Question :

Investment advisors are legally responsible for losses incurred by their clients.

True False

Points Received: 1 of 1

Comments:

Question 30. Question :

McDonald's stock is now selling for $57 per share. Kim wants to buy 100 shares but only if she can do so at $55 or less. She should place a(n)

stop order.

market order.

limit order.

odd-lot order.

Points Received: 0 of 1

Comments:

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