1. The Stimulus Act of 2009, which provided funds to try to stimulate the economy during the financial crisis, is an example of the government's use of ________ to affect economic growth.

2.When a bond has a par or face value of $1,000 and a 6% coupon rate, the semiannual payment would be $60. (true or False)

3.A $1,000 bond with a coupon rate of 6.5% has a market price of $950. What is the current yield?

a.6.5%

b. 6.8%

c. 7.0%

d. 6.2%

4.Your son will be ready for college in 10 years and your daughter in 15. Which of the following bond strategies would be best suited to your goal of financing your children's education?

a. Interest rate

b. Passive

c. Maturity matching

d. Active

5.Which of the following statements is not true regarding municipal bonds?

a. They are issued by state and local governments.

b. They are free from the risk of default.

c. The interest is exempt from federal income taxes.

d. The interest is exempt from state taxes if the investor resides in the state where the bond was issued.

6.Of the management, advertising, and administrative fees charged by mutual funds, normally the management fee is the smallest. (True or False)