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BF21 - 3.04 Stocks, Bonds, Mutual Funds Flashcards | StudBud
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BF21 - 3.04 Stocks, Bonds, Mutual Funds
BF21 - 3.04 Stocks, Bonds, Mutual Funds
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3.04 Acquire knowledge of securities products and benefits
Flashcards
17 cards
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Questions
17
Answers
1
A company has earned a profit, and now shareholders receive a cash payment. This is:
capital appreciation.
dividends.
a stock split.
a stock exchange.
2
Which best describes a marketable bond?
one that comes from a governing body
one that is bought and sold in the open market
one that later becomes a stock at a market
one that is paid back before maturity
3
If you had 10 shares worth $10 each, but now have 20 shares worth $5 each, this is due to
dividends.
a stock exchange.
capital appreciation.
a stock split.
4
Investors can trade securities that have been issued by a corporation on a/an:
stock market index.
secondary market.
initial public offering.
primary market.
5
To know how likely it is that the corporations will pay back bonds, look at the:
bond rating.
coupon rate.
issuer.
bid price.
6
Mutual funds that contain both stocks and bonds are known as:
money market funds.
balanced funds.
index funds.
exchange-traded funds.
7
Which is a disadvantage of investing in bonds?
low returns
offering unmatched reliability
performing well when the economy is poor
meeting long-term goals
8
A bond's profit or loss over a period of time at a particular amount is called the:
bid price.
maturity.
yield.
liquidity.
9
The best place to go for detailed information about a mutual fund is…
mutual fund prospectus
newspaper
mutual fund website
trade magazine
10
Which type of stock comes with voting rights?
income
preferred
common
small cap
11
$100 worth of stock in a company is now worth $150. This is an illustration of:
a stock split.
dividends
a stock exchange.
capital appreciation.
12
mutual funds w/o limits on number of shares issued or amount of money held are::
stock fund.
closed-end fund.
growth fund.
open-end fund.
13
Since John wants to know the bond’s interest rate, he needs to look at the bond’s:
coupon.
par value.
issuer.
maturity.
14
Mutual fund's _____ mean the overall fund is only slightly affected if one stock becomes worthless
diversification
liquidity
convenience
professional money management
15
Which is the least important variable of a bond fund?
The credibility ratings of the fund
The rate at which the money in the fund increases
The amount of time you spend researching bonds in the fund
The maturity of the bonds in the fund
16
A company issues ___ to raise financing for ongoing operations or expanding the business
savings bond
municipal bond
treasury bond
corporate bond
17
Which is considered a reliable bond?
callable
puttable
government
corporate