WorksheetsEcon Quiz 11.1-11.3
Total questions: 25
Worksheet time: 13mins
A fund that pools the savings of many individuals and invests this money in a variety of stocks, bonds, and other financial assets is called a(n)
mutual fund.
investment.
financial system.
prospectus.
In the financial system, who are the borrowers?
households, individuals, and businesses
governments and businesses
governments, households, and individuals
individuals and households
Pension funds
are set up by employers to collect deposits and distribute payments.
require employer contributions and must withhold a percentage of workers' salaries.
are income distributed only to retirees who have worked a certain amount of years.
are deposits that are invested in bonds, not stocks or other higher risk financial assets.
An institution that helps channel funds from savers to borrowers is a
prospectus.
financial intermediary.
mutual fund.
portfolio.
A collection of financial assets is known as an investor's
a mutual fund.
prospectus.
portfolio.
diversification.
The higher the potential return, the
higher the liquidity of an investment.
lower the time risk for an investment.
higher the risk for an investment.
higher the inflation risk for an investment.
Spreading out investments to reduce risk is
a financial system.
a financial intermediary.
a financial asset.
diversification.
Which of the following are financial assets traded in money markets?
Treasure notes
Treasury bills
corporate bonds
municipal bonds
A low-rated, potentially higher-paying bond is a
savings bond.
municipal bond.
corporate bond.
junk bond.
The market for selling financial assets that can only be redeemed by the original holder is the
primary market.
secondary market.
capital market.
money market.
The interest rate that a bond issuer will pay to a bondholder is the
maturity.
coupon rate.
par value.
yield.
Compared to other types of bonds, the minimum denominations of savings bonds are relatively
low.
moderate.
high.
variable.
An investor purchases a company's bond from two years ago with a lower coupon rate than this year's bond. Why would the investor want to buy a lower-interest bond in the secondary market?
opportunity to negotiate a longer maturity
opportunity to negotiate a lower par value to offset the lower interest rate
opportunity to negotiate a higher yield from the other investor
opportunity to negotiate a higher par value to increase the yield
The annual rate of return on a bond bought on the open market is called the
par value.
coupon rate.
yield.
maturity.
The market in which money is lent for periods of less than a year is the
primary market.
secondary market.
capital market.
money market.
The call option
is helpful to investors who would rather purchase stocks directly though a broker.
allows investors to purchase stocks at a going rate for a group of companies.
is a way for investors to avoid paying a future higher price of a stock.
obligates investors to sell commodities at a specified price.
Which of the following indexes gives the broadest picture of stock performance?
the Dow
the OTC
the New York Stock Exchange
the S & P 500
The size of the dividend per share of stock depends on the
initial amount invested by the investor.
corporation's profits.
Dow.
stock exchange.
A individual portion of stock is referred to as a(n)
equity.
share.
capital gain.
stock split.
An firm that specializes in buying and selling stocks for individual investors is a
brokerage firm.
stock exchange.
stock split.
capital gain.
An investor who owns stocks in many different companies would most likely see a rise in the overall value of her portfolio during a
bull market.
bear market.
capital gain.
dividend growth.
The index that shows how 30 specific industrial stocks have traded is called the
stock exchange.
S & P 500.
Dow.
OTCC market.
Futures are
claims of ownership in a corporation.
bond yields.
contracts to buy or sell at a specific date in the future at a price specified today.
portions of stock.
In the late 1920's, which of the following methods allowed investors to purchase stock at a fraction of its price and borrow the rest from the brokerage firm?
buying on futures
buying on a bear market
buying on a margin
buying on debt
I certify, on penalty of receiving zero credit for this course, that in completing this test, l have done so honestly without the help of others or resources not agreed to by my teacher.
Yes
No
