Before You Invest
An important difference between common stock and preferred stock is that the price of the common stock tends to be more ________ than that of preferred stock. a.) volatile b.) stable c.) expensive
a.)
Common stock ownership gives investors: a.) voting rights in shareholders meetings b.) guaranteed dividends c.) low risk with a high rate of return
a.)
Stock prices fall because: a.) there are more sellers than buyers b.) companies don't make profits everyday c.) dividends are paid
a.)
A company gets money from shareholders when: a.) its stock is issued b.) it makes a profit c.) shares are traded between buyers and sellers
a.)
"pf" Next to a stock means that this stock is: a.) private fund stock b.) preferred stock c.) performing at a higher than usual profit margin
b.)
Based on the Rule of 72, if you invested money and earned 8% interest, your money would double in a.) 72 years b.) 9 years c.) 8 years
b.)
Conservative, _____________, and moderate are types of risk takers. a.) democratic b.) speculative c.) entrepreneurial
b.)
Dividends are defined as: a.) stock b.) money paid out regularly (usually quarterly) to by a company to its share holders c.) bonds sold by municipalities
b.)
Mary's mother owns Target stock. She currently receives a dividend payment every quarter. She is guaranteed to receive a dividend every quarter as long as she owns Target stock. a.) True b.) False
b.)
Some investors place a greater priority on high earnings than on safety. They prefer __________ stocks. a.) no beta b.) low beta c.) high beta
b.)
The statement "risk and reward are related" implies: a.) making money in the stock market is risky b.) the lower the risk the lower the reward c.) there is no reward in taking a risk
b.)
You love KitKats! You bought 150 shares at $45 to add to your portfolio. While eating away, you earned a dividend of .75 a share. Later you decided you are getting fat and you sell your Hershey stock for $44 a share. How did your candy addiction affect you investment? a.) You made $102.50 b.) You lost $37.50 c.) You lost $150
b.)
A bond is: a.) contract for credit b.) money borrowed from a bank c.) a type of IOU
c.)
Cal owns 100 shares of Tricor stock. Tricor pays an annual dividend of $6.25 per share. Cal will receive his first quarterly payment on March 30. The dividend check will be for: a.) $6.25 b.) $625.00 c.) $156.25
c.)
IPO means: a.) investor protection option b.) income public offering c.) initial public offering
c.)
If a dividend has been announced but not yet paid, the stock is said to have gone: a.) dividend deferred b.) pre-dividend c.) ex-dividend
c.)
Interest earned on interest occurs with: a.) buying on margin b.) diversification c.) compounding
c.)
You could find a tombstone ad: a.) On a television commercial b.) In a company's annual report c.) In the Wall Street Journal
c.)