Question 1

A request that a stock be bought or sold at a specified price is called a ____________ order.

Accepted Answer

A)  market
B)  limit
C)  stop
D)  round
E)  discretionaryF) B) and C)
G) All of the above

Question 2

A request that an order be executed at the next available opportunity after the market price of the stock reaches a specified price is called a ____________ order.

Accepted Answer

A)  market
B)  limit
C)  stop
D)  round
E)  discretionaryF) B) and E)
G) A) and C)

Question 3

A securities exchange is a marketplace where member brokers who are representing investors meet to buy and sell securities.

Accepted Answer

A) True 
 B)False

Question 4

On May 24,2010,Kurt Rogers bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Kurt receive for this quarterly dividend?

Accepted Answer

A)  $0.00
B)  $1.25
C)  $12.50
D)  $125.00
E)  $0.13F) B) and D)
G) B) and E)

Question 5

Which one of the following is a true statement?

Accepted Answer

A)  When choosing a stock advisory service that charges fees for their investment advice,the quality of the information is always excellent.
B)  Mergent's Investors Service only provides information about bonds.
C)  Value Line provides information about bonds and mutual funds,but not common stocks.
D)  The information provided by investors' services consists of simple alphabetical listings only.
E)  Online computer services may be used to research companies and to obtain current stock prices.F) B) and C)
G) All of the above

Question 6

A stock that follows the business cycle of advances and declines in the economy is called a(n) ____________ stock.

Accepted Answer

A)  defensive
B)  cyclical
C)  growth
D)  income
E)  blue-chipF) B) and E)
G) C) and D)

Question 7

Sean Rouse owns shares of common stock in Stowaway Transportation Company.The company is getting ready to pay a dividend.Sean knows he must be registered on the corporation's books on the date in order to receive the dividend.

Accepted Answer

A)  record
B)  ex-dividend
C)  payment date
D)  declaration
E)  stockholders' meetingF) B) and D)
G) A) and E)

Question 8

What is the primary difference between common stock and preferred stock?

Accepted Answer

The answer of What is the primary difference between common...

Question 9

When a stock splits two-for-one,you should expect the price per share to:

Accepted Answer

A)  decrease to half its pre-split price.
B)  decrease in value by 75 percent or more.
C)  remain unchanged.
D)  increase to more than twice its pre-split price.
E)  increase to twice its pre-split pricE.F) C) and E)
G) A) and C)

Question 10

Since 1926,stocks as measured by the Standard & Poor's 500 Index have returned on average about 10 percent a year.

Accepted Answer

A) True 
 B)False

Question 11

Initial public offerings (IPO's) are a ___________ investment.

Accepted Answer

A)  guaranteed
B)  speculative
C)  safe
D)  conservative
E)  blue chipF) B) and D)
G) B) and C)

Question 12

A market in which an investor purchases financial securities (via an investment bank or other representative) from the issuer of those securities is called the ____________ market.

Accepted Answer

A)  technical
B)  fundamental
C)  efficient
D)  secondary
E)  primaryF) A) and B)
G) All of the above

Question 13

Convertible preferred stock may be exchanged,at the corporation's option,for a specified number of shares of common stock.

Accepted Answer

A) True 
 B)False

Question 14

An increase in a corporation's earnings per share is a healthy sign.

Accepted Answer

A) True 
 B)False

Question 15

Carol Fisher wants to sell the stock of Hathaway International at the next available price after the market price reaches $50 per share.What type of order should she place?

Accepted Answer

A)  market order
B)  limit order
C)  stop order
D)  discretionary order
E)  common orderF) D) and E)
G) C) and E)

Question 16

To calculate dividend yield,the annual dividend amount per share is divided by the _______ per share.

Accepted Answer

A)  current stock price
B)  stock's original issue value
C)  current earnings
D)  current book value
E)  current salesF) A) and D)
G) A) and E)

Question 17

Which one of the following statements is true?

Accepted Answer

A)  It is possible to obtain financial information about a corporation that issues stock by using the Internet.
B)  While it is possible to obtain information about a company by accessing the Internet,the information is usually out of date.
C)  You can use an Internet search engine to only access a company's price information.
D)  Corporations have web pages but do not provide any financial information on them.
E)  By using the Yahoo! Finance web site,investors can access financial information only about the economy as a wholE.F) B) and D)
G) B) and E)

Question 18

Dividends remain with the stock until:

Accepted Answer

A)  two business days before the date of record.
B)  two business days after the date of record.
C)  three days before the date of record.
D)  three days after the date of recorD.
E)  three days before the actual payment datE.F) A) and B)
G) A) and D)

Question 19

An investment theory based on the assumption that a stock's market value is determined by the forces of supply and demand in the stock market as a whole is called the ____________ theory.

Accepted Answer

A)  fundamental
B)  technical analysis
C)  efficient market
D)  primary
E)  marketF) B) and E)
G) None of the above

Question 20

The total return on a stock is equal to the current market value of the stock minus the investor's purchase price.

Accepted Answer

A) True 
 B)False

Exam 14: Investing in Stocks

A request that an order be executed at the next available opportunity after the market price of the stock reaches a specified price is called a ____________ order.

Correct AnswerverifiedShow Answer

Sean Rouse owns shares of common stock in Stowaway Transportation Company.The company is getting ready to pay a dividend.Sean knows he must be registered on the corporation's books on the date in order to receive the dividend.

Correct AnswerverifiedShow Answer

A market in which an investor purchases financial securities (via an investment bank or other representative) from the issuer of those securities is called the ____________ market.

Correct AnswerverifiedShow Answer

A request that a stock be bought or sold at a specified price is called a ____________ order.

Correct AnswerverifiedShow Answer

A stock that follows the business cycle of advances and declines in the economy is called a(n) ____________ stock.

Correct AnswerverifiedShow Answer

Dividends remain with the stock until:

Correct AnswerverifiedShow Answer

To calculate dividend yield,the annual dividend amount per share is divided by the _______ per share.

Correct AnswerverifiedShow Answer

Since 1926,stocks as measured by the Standard & Poor's 500 Index have returned on average about 10 percent a year.

Correct AnswerverifiedShow Answer

Convertible preferred stock may be exchanged,at the corporation's option,for a specified number of shares of common stock.

Correct AnswerverifiedShow Answer

An investment theory based on the assumption that a stock's market value is determined by the forces of supply and demand in the stock market as a whole is called the ____________ theory.

Correct AnswerverifiedShow Answer

A securities exchange is a marketplace where member brokers who are representing investors meet to buy and sell securities.

Correct AnswerverifiedShow Answer

Which one of the following is a true statement?

Correct AnswerverifiedShow Answer

Initial public offerings (IPO's) are a ___________ investment.

Correct AnswerverifiedShow Answer

What is the primary difference between common stock and preferred stock?

Correct AnswerverifiedShow Answer

The total return on a stock is equal to the current market value of the stock minus the investor's purchase price.

Correct AnswerverifiedShow Answer

When a stock splits two-for-one,you should expect the price per share to:

Correct AnswerverifiedShow Answer

Carol Fisher wants to sell the stock of Hathaway International at the next available price after the market price reaches $50 per share.What type of order should she place?

Correct AnswerverifiedShow Answer

Which one of the following statements is true?

Correct AnswerverifiedShow Answer

On May 24,2010,Kurt Rogers bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Kurt receive for this quarterly dividend?

Correct AnswerverifiedShow Answer

An increase in a corporation's earnings per share is a healthy sign.

Correct AnswerverifiedShow Answer

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