FUHRMS - FinLit Final Question Preview (ID: 40699)


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On June 30, 2013, you purchase a 6.0% coupon bond with a $5,000 face amount maturing on 06/30/2018. How much will you receive in principal on the maturity date?
a) $5,000
b) $1,500
c) $5,300
d) $300

The relationship between risk and return in investing can be stated as:
a) higher risk indicates higher potential return
b) higher risk indicates lower potential return
c) lower risk indicates higher potential return
d) No relationship exists between risk and return

To get a high degree of diversification and minimize risk, you should have at least 15 different stocks in your portfolio. Since most of us aren't experts, a good investment option would be.
a) Mutual Funds
b) Certificate of Deposit
c) Municipal Bonds
d) Penny Stocks

When referring to the past performance of a stock, which of the following is NOT true?
a) Past performance indicates how profitable the company has been over the past 52 weeks.
b) Past performance refers to how well the stock performed over the last 52 weeks or some other time frame.
c) Past performance can researched online and charted by computer.
d) Past performance does not guarantee future returns.

An individual’s tolerance to risk (whether conservative, moderate or aggressive) is known as...
a) investment philosophy
b) diversification
c) positive correlation
d) disposable income

When considering investing in mutual funds, investors should...
a) Research the fees charged by the fund
b) Research which stocks to purchase for the fund
c) Research which bonds to purchase for the fund
d) Research each individual company the fund holds

Studying career clusters is important because...
a) You want to select an occupation that you will enjoy and that will provide you with the income necessary to support you.
b) It allows you to see firsthand what someone in a specific career field does on a daily basis.
c) Building your career aspirations around sports or acting can be risky because jobs in these areas can be difficult to obtain.
d) You want to select a job that pays high hourly wages.

If the average hs graduate earned $638 / week and had an unemployment of 9.4%, workers with Associate’s degrees earned $768 / wk and unemployed at 6.8% and people with a 4-year degree earned $1053 / wk with 4.9% unemployment, one can conclude...
a) Unemployment and earnings are directly linked to educational attainment.
b) Unemployment and earnings are not linked to educational attainment.
c) Unemployment is directly linked to educational attainment but earnings are not.
d) Earnings are directly linked to educational attainment but unemployment is not.

You purchased 100 shares of stock for $77.88 per share. You earn a quarterly dividend of $.33 per share. What is the TOTAL of dividends paid for the year?
a) $132.00
b) $66.00
c) $33.00
d) $0.33

Which is an example of an opportunity cost related to earning potential?
a) Reduce income by cutting back on work hours to have time to earn an associate’s degree
b) Pay for college with a scholarship
c) Improve time management skills
d) Decide on a career that fits into your desired lifestyle

Which of the following is NOT true in regards to investing in stock?
a) A stockholder will always receive a profit when the stock is sold.
b) A stockholder owns a part of a company.
c) Stockholders may pay different prices for the same stock.
d) A stockholder may or may not receive a dividend.

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