FMGT 1101 Test 3 Review

When establishing an investment program, a good early step is to examine the _________ ___________ for all ____________

If you buy a stock for $50, it pays a $4 dividend and you sell it for $51 a year later. What is your rate of return?

After-tax income divided by the number of shares outstanding is

If I want buy a stock at a specified price or better, I would place a ____________ order

People born after 1928 need ____ quarters of coverage to qualify for Social Security benefits?

An open end mutual fund takes on more money and extra investors on an ongoing basis

A bond is a type of lending investing (vs. owning)

A treasury security with a 30 year maturity is a

Assets divided by number of shares equals

If you invest 1000 a year for 30 years into a retirement account, and it's worth $35,000, how much has it earned?

When interest rates go _____, bond prices go _______

A call feature allows the corporation to buy outstanding bonds from current bondholders before the maturity date

I buy 100 shares of stock for $15 each. I sell them for $16 and pay a $10 fee. What is my dollar profit?

If I buy a $1000 par value bond for $800 and it earns $40 interest per year, and there are 19 years until maturity

The percentage of a fund's holdings that have changed or "been replaced" during a 12-month period is

Price per share divided by the earnings per share is

Morningstar and valueline are investor services

Stocks have an average return of 8% over the last several decades. It is the highest return of any investment type

What is YTM on a $1000 face value, that pays $60/year in interest, has 20 years left on it, and has a price of $900

In a defined benifit plan

A mutual fund that only offers new shares at inception and never again later is a closed end fund

When starting an investment program, you might

What does a REIT do?

In mutual funds, a "load" is when a customer pays commission to buy shares, or sometimes sell them

If an expense ratio for a mutual fund is between 0.5 and 2.0, it is considered....

In a defined contribution plan

difference between the bid price and the ask price is called the

Probably the biggest benefit of mutual funds is

Efficient market hypothesis includes: stocks move pretty randomly, and that all information is included in share price

Index funds have generally higher expense ratios since they are trying to find the best stocks in a specific area

When there is a two for one stock split the share price drops in half

A high level of financial leverage means an investment with a low level of debt

Preferred stockholders usually have voting rights

If you have a bond worth 1000 and it can be converted to 100 shares of stock.....

Dividend yield on preferred stocks is often higher than the return on corporate bonds

A stock market bubble is when shares are trading below their actual worth

Net asset value is the

An "ask" is a price that a seller is willing to receive

A prospectus is

A great way to reduce investment risk is with

A debenture bond has a specific asset to back it up

Some expenses change when you retire. Like medical expenses decrease and income taxes increase

Gold and other speculative assets have daily fluctuating prices based on supply and demand

If your money is in a mutual fund, dividends are never taxable

Pensions and retirement income payouts always keep pace with inflation

Sector funds invest in 500 stocks that match the fortune 500 index