Question 1

If you were to invest all of your money in a single company and it went bankrupt,you would not lose everything.

Accepted Answer

A) True 
 B)False

Question 2

Mutual funds are valued at their _________________,which is the total value of all the assets minus costs divided by the number of shares outstanding.

Accepted Answer

A)   Net of assets after cost (NA
C)  
B)   Net assets shares outstanding (NASO) 
C)   Net asset value (NAV) 
D)   Net assets over shares (NAS)

Question 3

Which factors are considered in calculating a mutual fund's expense ratio?

Accepted Answer

A)   Fees paid to the fund's investment manager
B)   Recordkeeping,accounting,and auditing fees
C)   Custodial services,taxes,and legal fees
D)   All options are correct

Question 4

Which is unlikely to be included in mutual fund fees?

Accepted Answer

A)   Front load
B)   Back-end load
C)   No load
D)   Front and back-end load

Question 5

When you buy a mutual fund,you own _________________.

Accepted Answer

A)   The individual stock directly
B)   Shares of a fund that owns the assets
C)   Stock in the mutual fund company
D)   Stocks and bonds

Question 6

Mutual funds can be purchased directly from mutual fund companies,financial planners,financial advisers,full service brokerages houses,discount brokerage houses,insurance companies,and banks.

Accepted Answer

A) True 
 B)False

Question 7

A front-end load is the fee charged when you sell a mutual fund,which could include the commission of the financial planner or selling agent who sold you the funds.

Accepted Answer

A) True 
 B)False

Question 8

The NAV is commonly referred to as the _________________ of the mutual fund.

Accepted Answer

A)   Net asset value
B)   Share price
C)   Cost
D)   Overhead

Question 9

What is the difference between dollar cost averaging and continuous automatic investing?

Accepted Answer

A)   Continuous automatic investing doesn't have any stated lump sum or end date
B)   Dollar cost averaging is when you have a large amount of money to invest and you invest specific portions of the lump sum at specific times until the entire sum is invested
C)   Both options are correct
D)   Neither option is correct

Question 10

The Morningstar Style Box evaluates a mutual fund based on _________________.

Accepted Answer

A)   The capital asset size of the companies it holds and whether the companies in the fund are value-based,growth,or a blend of value-based and growth
B)   The performance of the mutual fund since the inception of the fund
C)   The performance of the mutual fund,excluding the expense ratio since the inception of the fund
D)   The individual performance of each stock in the fund

Question 11

No-load funds often outperform load funds--especially when you consider that 100% of the investment is working for you.

Accepted Answer

A) True 
 B)False

Question 12

There are two kinds of prospectuses: (1)the statutory prospectus and (2)the summary prospectus; however,the summary version does not include information on the fund's investment objectives,its strategies for achieving the objectives,the principal risks of investing in the fund,the fund's fees and expenses,and its past performance.

Accepted Answer

A) True 
 B)False

Question 13

List the characteristic of a money market fund.

Accepted Answer

Characteristics of a money market fund i...

Question 14

Since in most cases their compensation is tied to the performance of their funds,fund managers are motivated to make their funds grow.

Accepted Answer

A) True 
 B)False

Question 15

A _________________ mutual fund is a fund in which the companies market their funds online (no sales force or financial planners) and do not charge a fee.

Accepted Answer

A)   Front-end load
B)   Back-end load
C)   No load
D)   Exclusive

Question 16

How is a mutual fund's expense ratio calculated?

Accepted Answer

A)   Total operating expenses
B)   Total operating expenses for year/12 months
C)   Total operating expenses divided by average dollar value of the fund's assets
D)   Average monthly operating expenses divided by average asset value

Question 17

List three places where you can buy mutual funds and the benefits and drawbacks of each.

Accepted Answer

(1)You can buy mutual funds directly fro...

Question 18

_________________ is (are) an unsecured obligation issued by a corporation to finance its short-term credit needs.

Accepted Answer

A)   Commercial paper
B)   Commercial agreements
C)   Repurchase agreements
D)   Repurchase paper

Question 19

The first mutual funds were _________________ mutual funds,and now the majority of mutual funds are _________________.

Accepted Answer

A)   Closed-end; open-end
B)   Open-end; closed-end
C)   Not profitable; profitable
D)   None of the options are correct

Question 20

Mutual funds can be fully invested in federal bonds,municipal bonds,gold,silver,stocks,bonds,or a variety of stocks,bonds,and other investments.

Accepted Answer

A) True 
 B)False

Exam 12: Mutual Funds

Mutual funds can be fully invested in federal bonds,municipal bonds,gold,silver,stocks,bonds,or a variety of stocks,bonds,and other investments.

Correct Answer
verified

Since in most cases their compensation is tied to the performance of their funds,fund managers are motivated to make their funds grow.

Correct Answer
verified

Mutual funds are valued at their _________________,which is the total value of all the assets minus costs divided by the number of shares outstanding.

Correct Answer
verified

The Morningstar Style Box evaluates a mutual fund based on _________________.

Correct Answer
verified

A front-end load is the fee charged when you sell a mutual fund,which could include the commission of the financial planner or selling agent who sold you the funds.

Correct Answer
verified

List the characteristic of a money market fund.

Correct Answer
verified
Characteristics of a money market fund i...
View Answer

Which is unlikely to be included in mutual fund fees?

Correct Answer
verified

The first mutual funds were _ mutual funds,and now the majority of mutual funds are _.

Correct Answer
verified

What is the difference between dollar cost averaging and continuous automatic investing?

Correct Answer
verified

No-load funds often outperform load funds--especially when you consider that 100% of the investment is working for you.

Correct Answer
verified

How is a mutual fund's expense ratio calculated?

Correct Answer
verified

The NAV is commonly referred to as the _________________ of the mutual fund.

Correct Answer
verified

A _________________ mutual fund is a fund in which the companies market their funds online (no sales force or financial planners) and do not charge a fee.

Correct Answer
verified

Mutual funds can be purchased directly from mutual fund companies,financial planners,financial advisers,full service brokerages houses,discount brokerage houses,insurance companies,and banks.

Correct Answer
verified

When you buy a mutual fund,you own _________________.

Correct Answer
verified

Which factors are considered in calculating a mutual fund's expense ratio?

Correct Answer
verified

List three places where you can buy mutual funds and the benefits and drawbacks of each.

Correct Answer
verified
(1)You can buy mutual funds directly fro...
View Answer

If you were to invest all of your money in a single company and it went bankrupt,you would not lose everything.

Correct Answer
verified

_________________ is (are) an unsecured obligation issued by a corporation to finance its short-term credit needs.

Correct Answer
verified

Correct Answer
verified

Exam 12: Mutual Funds

Mutual funds can be fully invested in federal bonds,municipal bonds,gold,silver,stocks,bonds,or a variety of stocks,bonds,and other investments.

Correct AnswerverifiedShow Answer

Since in most cases their compensation is tied to the performance of their funds,fund managers are motivated to make their funds grow.

Correct AnswerverifiedShow Answer

Mutual funds are valued at their _________________,which is the total value of all the assets minus costs divided by the number of shares outstanding.

Correct AnswerverifiedShow Answer

The Morningstar Style Box evaluates a mutual fund based on _________________.

Correct AnswerverifiedShow Answer

A front-end load is the fee charged when you sell a mutual fund,which could include the commission of the financial planner or selling agent who sold you the funds.

Correct AnswerverifiedShow Answer

List the characteristic of a money market fund.

Correct AnswerverifiedCharacteristics of a money market fund i...View AnswerShow Answer

Which is unlikely to be included in mutual fund fees?

Correct AnswerverifiedShow Answer

The first mutual funds were _________________ mutual funds,and now the majority of mutual funds are _________________.

Correct AnswerverifiedShow Answer

What is the difference between dollar cost averaging and continuous automatic investing?

Correct AnswerverifiedShow Answer

No-load funds often outperform load funds--especially when you consider that 100% of the investment is working for you.

Correct AnswerverifiedShow Answer

How is a mutual fund's expense ratio calculated?

Correct AnswerverifiedShow Answer

The NAV is commonly referred to as the _________________ of the mutual fund.

Correct AnswerverifiedShow Answer

A _________________ mutual fund is a fund in which the companies market their funds online (no sales force or financial planners) and do not charge a fee.

Correct AnswerverifiedShow Answer

Mutual funds can be purchased directly from mutual fund companies,financial planners,financial advisers,full service brokerages houses,discount brokerage houses,insurance companies,and banks.

Correct AnswerverifiedShow Answer

When you buy a mutual fund,you own _________________.

Correct AnswerverifiedShow Answer

Which factors are considered in calculating a mutual fund's expense ratio?

Correct AnswerverifiedShow Answer

List three places where you can buy mutual funds and the benefits and drawbacks of each.

Correct Answerverified(1)You can buy mutual funds directly fro...View AnswerShow Answer

If you were to invest all of your money in a single company and it went bankrupt,you would not lose everything.

Correct AnswerverifiedShow Answer

_________________ is (are) an unsecured obligation issued by a corporation to finance its short-term credit needs.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified
Characteristics of a money market fund i...
View Answer

Correct Answer
verified

The first mutual funds were _ mutual funds,and now the majority of mutual funds are _.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
(1)You can buy mutual funds directly fro...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified