PoBF Unit 4.03 Review (14 Questions) Question Preview (ID: 10170)


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Jack is reviewing his investment portfolio to make sure it includes options that will allow him to access money immediately.The evaluation factor of saving he considers is:
a) liquidity
b) taxes
c) safety and risk
d) potential return

Mary needs a savings plan that will allow her to access her money as cash for potential emergency needs. Which type of evaluation factor of saving is she considering?
a) liquidity
b) taxes
c) safety and risk
d) potential return

Mary's business has $5,000 to start a savings plan. She is comparing bank interest rates between a mutual fund and a regular savings account. Which evaluation factor is considered?
a) liquidity
b) taxes
c) safety and risk
d) potential return

Bob sells specialty guitars and hopes to exchange the guitars for a much higher value than the purchase price. Which type of investment could the guitars become?
a) collectibles
b) commodities and futures
c) commodity exchanges
d) gold, silver and precious metals

Quilts purchased from Tyson's Antique Store over 25 years ago can be exchanges for higher prices than they were originally purchased. Which type of investment are the quilts?
a) collectibles
b) commodities and futures
c) commodity exchanges
d) gold, silver and precious metals

The city government needs 1.2 million dollars to build a new medical facility. Which type of bond investment opportunity would help the city government obtain funding for this?
a) corporate bond
b) municipal bond
c) treasury bill
d) treasury notes

How are common and preferred stocks different?
a) Common stock pays stockholders limited dividend payments.
b) Common stockholders have non-voting rights.
c) Preferred stock stockholders have priority in dividend payments.
d) Preferred stock stockholders have a minimum period of ownership.

How are common and preferred stocks similar?
a) Both pay limited dividend payments.
b) Both have a risk of loss of a investment.
c) Both have the same amount of risk.
d) Both stockholders have voting rights.

RadioShack offers shares of stock to investors at a consistent rate of 6% without any voting rights. What type of stock is it offering?
a) Bond
b) Common stock
c) Mutual fund
d) Preferred stock

How much interest is earned on a balance of $1,000 for a certificate of deposit that is compounded at an 8% interest rate for an account maintained for three years?
a) $135.00
b) $241.30
c) $259.71
d) $301.89

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