Grading SummaryThese are the automatically computed results of your exam. Grades for essay questions, and comments from your instructor, are in the "Details" section below. Date Taken: Time Spent: Points Received:
Question Type: # Of Questions: Multiple Choice 20

Grade Details - All QuestionsQuestion 1. Question : Institutional investors manage money for businesses and nonprofit organizations, but not for individuals.
Student Answer: True
False





Question 2. Question : A collection of securities designed to meet an investment goal is called a portfolio.
Student Answer: True
False





Question 3. Question : Almost half of Americans own stock or stock mutual funds.
Student Answer: True
False





Question 4. Question : Which of the following economic conditions is most difficult to identify:
Student Answer: recovery
expansion
recession
change in direction





Question 5. Question : You should spend money on housing, clothing and basic insurance before investing.
Student Answer: True
False





Question 6. Question : Some foreign investments may provide higher returns or lower risk than purely domestic investments.
Student Answer: True
False





Question 7. Question : The value of a derivative security is based on the value of an underlying security.
Student Answer: True
False





Question 8. Question : The periodic payment that a corporation pays to its shareholders from net earnings is called a capital gain.
Student Answer: True
False





Question 9. Question : Which one of the following has the lowest level of risk?
Student Answer: commercial paper
money market mutual fund account
banker's acceptance
U.S. Treasury bill





Question 10. Question : Retirement plans, such as a 401(k), allow employees to defer taxes on the plan contributions until such time as the funds are withdrawn from the retirement plan.
Student Answer: True
False





Question 11. Question : Common stock is a type of debt instrument.
Student Answer: True
False





Question 12. Question : In the financial markets, individuals are net suppliers of funds.
Student Answer: True
False





Question 13. Question : Which one of the following would be the LEAST liquid investment?
Student Answer: stock
series EE bond
money market mutual fund
real estate





Question 14. Question : As the number of investments in a portfolio increases, the risk of the portfolio ________
Student Answer: increases.
decreases.
stays the same.
is eliminated.





Question 15. Question : Under current tax law, dividend income is taxed at the same rate as
Student Answer: ordinary income.
short-term capital gains.
long-term capital gains.
interest income.





Question 16. Question : In selecting investments consistent with your goals, you should consider
Student Answer: rates of return and taxes only.
the pre-tax rate of return only.
annual dividends and taxes only.
risks, returns, and taxes.





Question 17. Question : On a net basis, funds in the financial markets are generally supplied by
Student Answer: individuals.
both individuals and business firms.
business firms.
the government.





Question 18. Question : Bonds represent a higher level of risk than do stocks in the same company.
Student Answer: True
False





Question 19. Question : Retirees seeking income prefer
Student Answer: growth-oriented common stock and certificates of deposit.
growth-oriented common stock and preferred stock.
preferred stock and options.
government bonds and low-risk income stocks.





Question 20. Question : Growth oriented investments and speculative vehicles are preferred by
Student Answer: young investors.
middle-aged investors.
retired investors.
any age investor who prefers low risk.