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 22 Grade Details - All QuestionsQuestion 1. Question : IPOs that are generally made available to the average investor tend to be the less desirable new offerings. Student Answer: True False Question 2. Question : The total-return approach concentrates solely on capital gains over the long-term. Student Answer: True False Question 3. Question : Which strategy applies to investors who fund long-term goals with high-quality stocks which they retain for the entire investment period? Student Answer: quality long-term growth buy and hold speculation current income Question 4. Question : American Depositary Receipts (ADRs) are issued against shares of U.S. corporations and are traded on foreign security exchanges. Student Answer: True False Question 5. Question : Income stocks are well suited for retirees because Student Answer: dividend income is tax-free. the capital gains are predictable. dividend yields tend to exceed bond yields. dividends tend to increase over time. Question 6. Question : The value that investors place on a stock is called its Student Answer: book value. investment value. liquidation value. par value. Question 7. Question : Aggressive stock management Student Answer: is the riskiest of all the investment strategies. involves active stock trading in the short-term in the quest for capital gains. concentrates on the long-term growth aspects of a security. concentrates on high dividend yielding stocks. Question 8. Question : While many stocks increase in value over the long run, most of the return on stocks comes from dividends. Student Answer: True False Question 9. Question : The par or stated value of common stock is important for Student Answer: accounting purposes only. helping the investor determine the stock's intrinsic value. helping the board of directors determine the dividend payout. helping the market determine the trading price of the stock. Question 10. Question : Rob owns 300 shares of Blackwood common stock valued at $9 a share. Blackwood has declared a 3-for-1 stock split effective tomorrow. After the split, Rob will own Student Answer: 100 shares valued at about $27 a share. 100 shares valued at about $3 a share. 900 shares valued at about $27 a share. 900 shares valued at about $3 a share. Question 11. Question : A market correction is defined as a stock market decline of 5% or more. Student Answer: True False Question 12. Question : Stocks whose prices are expected to remain stable, or even prosper, when economic activity is slowing down are known as Student Answer: defensive stocks. cyclical stocks. reversible stocks. speculative stocks. Question 13. Question : Treasury stock is a means of increasing the number of shares outstanding. Student Answer: True False Question 14. Question : Every shareholder is a part owner of the firm and, as such, has a direct claim on a portion of the firm's assets. Student Answer: True False Question 15. Question : With respect to dividend payments on stocks, the date of record is the date on which the payment is actually paid. Student Answer: True False Question 16. Question : The decision of how much money to pay out in dividends is made by the Student Answer: board of directors. company shareholders. chief executive officer. chief financial officer. Question 17. Question : When a company, working with an underwriter, offers the investing public a certain number of shares of its stock at a certain price, the company is making what is known as a Student Answer: public offering. rights offering. stock spin-off. treasury offering. Question 18. Question : Mid-cap stocks are generally classified as those with a market capitalization between $1 and $5 billion. Student Answer: True False Question 19. Question : Assume the Plum Corporation has two different issues of common stock. One issue carries voting rights, and the other issue does not. In this situation, Plum is said to have issued Student Answer: buy-back stock. treasury stock. OTC stock. classified stock. Question 20. Question : Which one of the following statements about common stock is true? Student Answer: Common stock can provide attractive capital appreciation opportunities. Dividends generally provide the greatest rate of return on common stocks. Common stocks generally have a negative rate of return over a ten-year period. The DJIA is the best indicator of the overall performance of common stocks. Question 21. Question : The technology bubble of the 1990s lasted about 18 months. Student Answer: True False Question 22. Question : The value of a stock distribution is considered taxable income at the time of the distribution. Student Answer: True False
