# FP 100T Week 5 WileyPLUS Weekly Exam

This Tutorial was purchased 2 times & rated A+ by students like you.

|  Write a review  |   Reviews (1)   |
Price: \$8.00

Attachments: FP 100T Week 5 WileyPLUS Weekly Exam.doc [ Preview Here ]

FP 100T Week 5 WileyPLUS Weekly Exam

In this graded assignment you are assessed on the content covered in this weeks’ readings, activities, and assignments. To help you prepare, it is recommended that you first complete this week’s Learning Path and Self-Test Learning Activities prior to completing this exam.

Complete the Week 5 Exam covering this week’s assigned readings:

• “Chapter 12: Investing in Stocks and Bonds”

• “Chapter 13: Investing in Mutual Funds and Real Estate”

Note: Work submitted in WileyPLUS does not count toward attendance. Be sure to post at least two times each week in the online classroom to avoid being auto-dropped from the course.

Question 1

A share of noncallable preferred stock has a par value of \$100 and pays 7 percent annual interest. Which of the following statements is true?

The stock will pay \$7 per year in interest as long as the company is in existence.

The stock will pay \$7 in interest in the first year, but the amount paid in future years will depend on what happens to interest rates in the future.

The stock will pay \$100 per year in interest for 20 years.

The stock will pay \$7 per year in interest and will pay the investors back the \$100 par value at maturity.

Question 2

Which of the following statements regarding bonds and inflation risk is true?

Rising inflation will generally cause bond prices to also rise.

Bonds are less influenced by inflation risk than are common stocks.

Long-term bonds have less inflation risk than short-term bonds.

Bond investors will require higher yields on bonds if inflation rises.

Question 3

Aeryn Soon is a potential investor of Hippy Dippy Inc.’s preferred stock, which is currently selling for \$475 per share. Hippy Dippy pays an annual dividend of \$40, and Aeryn’s required return is 8 percent. Should she purchase this preferred stock or NOT? Why?

Yes, because the value of the preferred stock is \$500.

No, because the value of the preferred stock is \$250.

Yes, because the value of the preferred stock is \$250.

No, because the value of the preferred stock is \$500.

Question 4

Yield to maturity is a popular measure because it tells an investor

the annualized yield they will earn if they hold the bond to maturity.

the yield they will earn if they sell the bond today.

how much interest they will receive each year.

none of the above.

Question 5

Riskier companies tend to pay ________ dividends than less risky companies.

higher

lower

Question 6

Aliyah purchased Verizon Communications stock in April 2015 for \$48.90 per share. She sold the stock one-year later for \$54.01 per share. Calculate her capital gains yield.

5.11%

9%

9.46%

10.45%

Question 7

A bond investor is a/ an

creditor.

lender and creditor.

lender.

owner.

Question 8

Large-cap companies have market capitalization greater than or equal to

\$10 million.

\$1 billion.

\$5 billion.

\$100 million.

Question 9

When a stock split occurs,

owners of stock end up with a lower proportionate number of shares.

the company expects the value of shares to go down in the future.

the price of new shares is lower than the old price.

the market usually views the split as bad news about future prospects for the company.

Question 10

Which of the following portfolio strategies is the most risky?

Investing 100 percent in a small-cap technology company

Investing 50 percent each in a small-cap technology company and a blue chip manufacturing company

Investing 100 percent in a blue chip manufacturing company

Investing equally in 20 stocks that are all in different industries

Question 11

John is considering purchasing some preferred stock from BBCC Corp. The company pays a \$30 annual dividend on its preferred stock, and John believes he should earn 7 percent on the stock based on the company’s risk profile. What is the value of the stock per share?

\$428.57

\$42.86

\$2.10

\$210.00

Question 12

The most common arrangement for bond coupon payments is

fixed-rate interest paid in semiannual payments.

floating-rate interest paid in annual payments.

zero-coupon payments.

indexed-rate payments.

Question 13

Which statement regarding load mutual funds is true?

The most common type of load is a front-end load.

The load can be as high as 10 percent of the purchase price of the shares.

A back-end load is part of the expense ratio.

Load funds make more sense for active investors than buy-and-hold investors.

Question 14

The basic equation for real estate return on investment is the increase in value plus the net rental income, minus the interest expense, all of which is divided by which financial component?

beginning investment

capital appreciation

ending outlay

market price

Question 15

A life-cycle fund purchases assets designed to meet the needs of individuals in

retirement only.

middle-income earning years.

a particular stage of life.

high-income-earning years.

Question 16

Financing the purchase of an investment in real estate with a mortgage at the time of borrowing at a low rate of interest and investing in assets that earn more than what they cost puts you ahead of the game due to the concept of

leverage.

diversification.

return on investment.

price appreciation.

Question 17

Which fund classification would a focus on only stocks of Chinese companies match?

Growth fund

Income fund

Balanced fund

International fund

Question 18

Maryanne invested \$1,000 in a mutual fund three weeks ago and noticed she was charged \$85 for the purchase. Which kind of fund did she likely buy?

a front-end load fund

a back-end load fund

an initial load fund

Question 19

Which fund classification would a focus on assets that pay interest and/or dividends match?

Growth fund

Income fund

Balanced fund

Global fund

Question 20

Most open-end mutual funds charge a front-end load, which is

a sales charge or commission paid by investors each year that they own shares in the fund.

a brokerage fee that is paid to a broker for selling mutual funds in the secondary market for an investor.

the annual expenses on the fund divided by the net asset value.

a sales charge or commission paid by an investor when purchasing shares in a mutual fund.

Question 21

ABC Fund has 9 million shares outstanding. The fund’s portfolio is now valued at \$300 million and the fund owes \$18 million to the fund advisors and \$5 million for rent and wages. What is the net asset value of the fund?

\$30.78

\$31.33

\$33.00

\$34.78

Question 22

Which is a characteristic of an exchange-traded fund (ETF)?

Shares are traded in the secondary market like shares in a closed-end fund.

Shares trade at the net asset value like shares in an open-end fund.

The number of shares outstanding is fixed as in a closed-end fund.

The shares are invested only in common stock of publicly traded corporations.

Question 23

Another term for back-end load is

contingent deferred sales charge.

Question 24

When a mutual fund assesses a charge at the time of a purchase it is called a(n) ________load.

front-end

back-end

redemption

initial

Question 25

If a firm has total expenses of \$1 million and total assets of \$20 million, what would the expense ratio be?

0.05 percent

0.5 percent

5 percent

50 percent

## Write a review

Order Id

Order Id will be kept Confidential

Rating:   A   B   C   D   F

Enter the code in the box below:

Related Products
\$8.00
Rating:A+
Purchased: 4 time
\$8.00
Rating:A
Purchased: 4 time
\$8.00
Rating:A+
Purchased: 2 time
\$8.00
Rating:A+
Purchased: 1 time
\$8.00
Rating:A+
Purchased: 2 time
\$35.00
Rating:A+
Purchased: 4 time

Tutorial Rank © 2019