Chaminade Univ MBA 754 (Investment Mgmt) Week 1 – Ch. 01 Quiz

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taxes on the plan contributions until such time as the funds are withdrawn from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.