If a bond is purchased at a price below the face value, the yield to maturity is:During your retirement, your employer’s health insurance plan and Medicare will cover your medical expenses.
greater than the stated interest rate.
the same as the stated interest rate.
less than the stated interest rate.
zero.
of no significance.
Question 2
A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called:
dollar cost averaging.
dividend reinvestment plan.
buy and hold technique.
regulated transaction.
secured transaction.
Question 3
A stock that sells for less than $1 per share is called a:
fractional stock.
penny stock.
dollar stock.
ten-dollar stock.
bad investment.
Question 4
Which one of the following expenditures for retirees is likely to decrease?
clothing expenses
insurance expenses
medical expenses
expenses for leisure activities
gifts and contributions
Question 5
During your retirement, your employer’s health insurance plan and Medicare will cover your medical expenses.
false
true
Question 6
What is likely to be an individual’s single biggest asset?
Their automobile
Their jewelry
Their bank account
Their home
None of the choices
Question 7
With an open-end credit, you pay back one-time loans in a specified period of time in equal amounts.
false
true
Question 8
Which of the following is most likely not a valid reason for using credit?
Borrowing for a stay in a hospital because of appendicitis
Borrowing to purchase a car so that you can go to work full time
Borrowing to buy a printer for your home office now because you now it will be twice as expensive in two years
Borrowing to pay for your expensive dinner and movie every week
All of the choices are valid reasons for using credit
Question 9
Gordon Carey uses his Visa card to purchase a new digital camera and lens. What type of credit did Gordon use?
Installment sales credit
Installment cash credit
Single lump sum credit
Revolving credit
Incidental credit
Question 10
For most mutual funds, the net asset value is calculated:
yearly.
quarterly.
weekly.
daily.
whenever an investor calls and requests a price quote.
Question 11
Which of the following is an advantage of an exchange traded fund (EFT)?
No minimum investment amount
Shares can be bought and sold through a broker at any time at the current price
Management fees are often lower
Can use limit orders to purchase EFTs
All of the choices are advantages of EFTs
Question 12
For a mutual fund, the turnover ratio measures:
the length of time a manager has been in charge of the fund.
the amount of profit the fund earns from one investment period to the next.
the number of months the average investor holds the fund before selling.
the percentage of a fund’s holdings that have changed during a 12-month period.
the percentage of institutional investors who own the fund.
Question 13
Grady Perdue has assets worth $1,500,000 and has written a legal document that specifies that all of his money go to his children. After he dies, there is a legal process to determine whether his document specifying how his assets be divided is valid. This is also the legal process by which his executor manages and distributes his property. What is this legal process called?
An estate
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