Introduction To Investing Quiz
Have you or are you studying finance, economics, investing or banking on a regular basis and how much information do you recall from the study? Take this quiz if you want to refresh your memory on investing.
- 1.The relatiioshipp between risk and return in investing can be stated as:
- A.
Higher risk indicates lower return
- B.
Higher risk indicates higher return
- C.
Lower risk indicates higher return
- D.
No relationship exists between risk and return
- 2.A diversified portfolio is desirable because it:
- A.
Increases the risk/return ratio
- B.
Limits investors choices to only one or two investment tools
- C.
Indicates an investor is a good predictor of the return an investment will have
- D.
Decreases risk by investing money in a variety of investment tools
- 3.Which of the following is true in regards to investing in stock?
- A.
A stock investor may or may not receive a profit
- B.
A stock investor may receive a dividend
- C.
A stock investor owns a part of a company
- D.
All of the above
- 4.What is a bond?
- A.
A type of debt that a company issues to investors for a specified amount of time
- B.
A share of ownership in a company
- C.
A type of investment that is only offered by depository institutions
- D.
A type of Certificate of Deposit with a higher than average interest rate
- 5.The value of a stock can change when:
- A.
Dollar value of a stock increases or decreases
- B.
A stock split occurs
- C.
A merger happens between two companies
- D.
All of the above
- 6.A growth stock is associated with a company:
- A.
That is new with a consistent record of relatively rapid growth and earnings
- B.
With a spotty earnings pattern but potential for substantial earnings in the future
- C.
Which dominates its respective industry and has a good company management reputation
- D.
With a steady stream of income paying high dividends and retaining only a small portion of profits
- 7.A blue chip stock is associated with a company:
- A.
With a consistent record of relatively rapid growth and earnings
- B.
With a spotty earnings pattern but potential for substantial earnings in the future
- C.
Which dominates its respective industry and has a good company management reputation
- D.
With a steady stream of income paying high dividends and retaining only a small portion of profits
- 8.Conner wants to purchase stocks with the money he received from his tax return. Who would he contact to make the transactions?
- A.
A brokerage firm
- B.
A depository institution
- C.
The New York Stock Exchange
- D.
Any of the above
- 9.
- A.
Real Estate
- B.
Mutual Fund
- C.
Savings Bond
- D.
Futures
- 10.What is inflation?
- A.
The rise in the general level of prices.
- B.
The uncertainty the return on an investment will deviate from what is expected.
- C.
The number of times something happens to money.
- D.
The projected value of an investment at the end of a specified time frame.
- 11.Why do you look at the long-term track record with a mutual fund?
- 12.
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