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An investor purchases 100 shares of DUD Corp. at $45 per share and purchases 1 DUD Oct 40 put at $6. What is the investore

An investor purchases 100 shares of DUD Corp. at $45 per share and purchases 1 DUD Oct 40 put at $6. What is the investore break even?

A.

$39

B.

$45

C.

$46

D.

$51

What is the maximum sales charge for a mutual fund?

A.

8%, which is built into the public offering price

B.

8%, which is added to the public offering price

C.

8 1/2%, which is built into the public offering price

D.

8 1/2%, which is added to the public offering price

An investor has $20,000 invested in a mutual fund with a sales charge of 8%. The fund offers a breakpoint of 4% for investments of $25,000 or more. If the investor deposits an additional $10,000, how much does the investor pay in sales charges under rights of accumulation?

A.

$400

B.

$600

C.

$1,000

D.

$2,000

The breakpoint that an investor receives when buying a mutual fund is based on:

A.

The amount of shares purchased

B.

The amount of money invested

C.

The type of securities that the fund is issuing

D.

The amount of investors participating in the mutual fund

An investor wishes to invest in a fund that has low management fees since the investor does not believe that a professional money manager can perform better than average. Which of the following should a RR recommend?

A.

Hedge fund

B.

Balanced fund

C.

Index fund

D.

Life cycle fund

A fund that invests based on a time horizon for retirement is a:

A.

Structured fund

B.

Hedge fund

C.

Life cycle fund

D.

ETF

An investor owns the following investments:

50 New York 5% General Obligation bonds maturing in 2025 and rated AA

50 Florida University 6.25% Revenue bonds maturing in 2026 and rated AA

50 Nevada Turnpike 5.75% Revenue bonds maturing in 2025 and rated AA

What type of diversification does this represent?

A.

Maturity

B.

Quality

C.

Quantity

D.

Geographical

Ginny Goldtrain is a wealthy investor who is in the highest income bracket. Ginny is looking for an investment that would limit her tax liability and put her on equal footing with investors in lower income-tax brackets. Which of the following securities would you MOST likely recommend?

A.

High-yield bonds

B.

CMO's

C.

Municipal bonds

D.

Hedge funds

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