Introduction to Investments (PRETEST)

A financial firm created a scatter plot for the daily stock returns of SocialMedia Works. Which scatter plot and trend line are the most accurate?

• 
• 
• 
• 

Look at the chart showing the daily stock data for WebTrend Inc.’s stock over the past month, and read this stock analyst’s view of the stock:

Stock analyst: There is a downward trend of the data with the peak price achieved on March 13. Investors are interested in WebTrend Inc. as demonstrated by the increase in trading volume.

Which statement is a fair conclusion based on the chart and the analyst’s comments about the WebTrend stock?

• The stock price increased and volume decreased on April 3.

• One month is not enough time to determine whether the price is at a low.

• The price has been falling, so an investor can assume it will begin to rise again soon.

• When the price change is negative for the day, an investor can assume the trading volume will decrease.

The stock market quote shows a three-year price graph for a 3-D printing company. What might an investor expect regarding the stock price or a price change in five days?

• The stock price will exceed $25.

• The stock price will be at a three-year high.

• The three-year change will stay negative.

• The three-year change will be positive.

Justin made a stock purchase to help increase his college fund. What might Justin expect from his investment?

• no loss of his original investment

• small interest rate payments

• potential for high growth and dividend payments

• a maturity date of five years

Line graphs show price trends over different time periods. What data points are used to create a line graph on the stock quote shown?

The line graph is created using the_______of the stock each_____

• close price; day

• open price; month

• close price; month

• volume; day

Identify the investment type and complete the description.

_____offer corporations a loan. Investors tend to choose this investment type because it offers safety and income based on an interest rate.

• Bonds

• Real Estate Investments

• Savings accounts

• Stocks

Brian makes an investment in his company’s stock. What does the stock chart say about the stock price today?

The down arrow indicates the stock price has decreased from yesterday’s price of_______at the_____of the market day.

• 65.26; open

• 65.73; high

• 66.20; close

Determine whether each scenario is an example of saving or investing.

Depositing money each month into an account at the bank for a car purchase

• Savings

• Investing

Determine whether each scenario is an example of saving or investing.

Purchasing stock for

long-term growth

• Savings

• Investing

Determine whether each scenario is an example of saving or investing.

Using a bank money market account

that earns 2% interest

• Savings

• Investing