1. A style portfolio manager offers two things: A. investment skill and market timing B.the specific style combined with a low beta C. a high beta and investment timing D. investment skill combined with the style 2. Which of the following is true? A. mutual funds report returns before adjusting for taxes B. 12b-1 fees exceed a fund's NAV C. small cup funds cannot have loads fees D. exchange-traded funds exchange their portfolios 3. Empirical studies of returns earned by investment companies indicate that: A. no funds outperform the market consistently B. most funds are less risky than the market C. most funds outperform the market consistently D. few fund outperform the market consistently 4. With a Roth IRA, the individual A. deducts the annual contributions B. earns tax-free income C. defers taxes D. avoids estate taxes 5. No load mutual funds may increase fees through 1. sales charges 2. commissions 3. 12b- 1 plans A. 1 and 2 B. 1 and 3 C. 2 and 3 D. only 3 6. Close-end investment companies 1. have a fixed capital structure 2. issue new stock whenever an individual buys shares 3. may sell for a premium over net asset value 4. must sell for their net asset value A. 1 and 3 B. 1 and 4 C. 2 and 3 D. 2 and 4 7. Which of the following is a consideration when selecting a mutual fund? 1. portfolio turnover 2. 12b- 1 fees 3. unrealized losses in the fund's portfolio A. 1 and 2 B. 1 and 3 C. 2 and 3 D. all of these choices 8. Which of the following is a reason for selecting a mutual fund? A. its historic return B. high tax efficiency C. charging 12b-1 fees instead of load fees D. often realizing portfolio gains 9. Which of the following is not a consideration in real estate investment trusts (REITs)? A. fluctuations in dividend payments B. excessive use of debt financing by some REITs C. fluctuations interest rates affecting securities valuations D. the federal tax rate paid by the trust 10. Open- end investment companies A. have a fixed number of taxes B. issue new stock whenever investors buy shares C. may sell for a discount from net asset value D. redeem shares at the investor's cost 11. Mutual funds ____ realized capital gains and income (e.g. dividends received) A. retain B. reinvest C. distribute D. distribute and reinvest 12. Which of the following is excluded from and individual's cash budget? A. wages and salary B. retirement account C. social security tax payments D. alimony 13. Use of P/E ratios will not produce superior investment results according to? A. the weak form of the efficient market hypothesis B. the semi-strong form of the efficient market hypothesis C. the strong form of the efficient market hypothesis D. all of the forms of the efficient market hypothesis 14. Possible investment objectives may include? 1. capacity to meet financial emergencies 2. preservation of capital 3. desire to finance retirement A. 1 and 2 B. 1 and 3 C. 2 and 3 D. all of these choices 15. Hedge funds follow investment strategies such as? A. acquiring shares in mutual funds B. shorting "overvalued" stocks while buying "undervalued" stocks C. limiting their portfolios to money market instruments D. underwriting new issues (IPOs) 16. Exchange-traded funds A. consistently outperform other funds B. mimic an index of securities C. require investors to select individual stocks D. are illustrations of load funds 17. Index funds tend to track? A. the stock market as a whole B. the bond market C. a specific measure of the market D. the return on other index funds 18. Which of the following is not an investment company? A. a money market mutual fund B. an index fund C. a commercial bank D. a growth mutual fund