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Exam 19: Using Securities Markets for Financing and Investing Opportunities

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Question 181

Multiple Choice

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An investment that pools together investors' money in order to buy securities in many different companies or governments is a ___________.

A) commercial fund
B) mutual fund
C) holding company
D) Public Investment Corporation

E) A) and B)
F) A) and C)

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Question 182

Multiple Choice

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Mutual fund investors will note that:

A) Fund managers have not yet added foreign securities into their funds.
B) Mutual funds cannot be purchased through a traditional brokerage house.
C) Loads can vary from one mutual fund to another.The fund manger dictates the commissions and fees.
D) By law,mutual funds can no longer charge loads.

E) A) and B)
F) All of the above

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Question 183

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U.S.investors have invested $11 trillion in mutual funds.

When you place a limit order,it means you are willing to buy or sell the stock at the best price available.

The number of U.S.companies that are listed on foreign stock exchanges is declining.

A Bond's face value is the same as its:

Debenture bonds represent bonds that are not secured by collateral.

When Tong Su purchased 500 shares of preferred stock in the Vibrates Corporation,his certificate indicated the stock had a par value of $50 per share.This means that Tong Su:

Brokers prefer trading shares of a firm's stock in multiples of 100,known as:

Dividends are paid out of a corporation's:

Index funds invest in one specific type of investment,for example,an index fund might only invest in income stocks,companies whose stocks pay dividends.

U.S.government bonds are considered safe investments.Therefore such government bonds usually have a lower interest rate than corporate bonds.

Which of the following describes the process where an investor borrows a percentage of the purchase price of stocks from the brokerage firm?

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.

Bonds sold at a discount are sold for more than the bond's face value.

Which of the following represents a disadvantage of issuing bonds?

If you are willing to hold on to your growth stock long enough,at least five years or more,you will realize capital gains.

A U.S.government bond paying 3.25% interest annually is a lower risk than a Bellandro Bay Brewery bond paying 6%.

Elaine plans to purchase 100 shares of Michigan International stock at $44 per share.The current margin rate is 40%.The maximum amount that Elaine could borrow from her broker is:

The cost of a firm borrowing money is called the: