Question
Can anyone help me solve these questions? Question 28 Back-end loads a. generally decline over a five to six year period. b. encourage short-term trading.
Can anyone help me solve these questions?
Question 28
Back-end loads
a. generally decline over a five to six year period.
b. encourage short-term trading.
c. were designed to help no-load funds cover their marketing expenses.
d. are charged when an investor buys their mutual fund shares.
Question 29
Interest rates will decline when: I. inflation rates increase. II. there is an increased expectation of future rises in inflation. III. inflation rates decrease. IV. there is an increased expectation of future declines in inflation.
a. I and II only
b. III only
c. I only
d. III and IV only
Question 30
A manager of a portfolio of bonds believes that interest rates are about to increase. Which of the following strategies for the portfolio would be optimal?
a. Sell the shorter duration bonds and buy those of longer duration.
b. Sell the shortest duration bonds and buy those with even shorter duration.
c. Sell the longer duration bonds and buy those of shorter duration.
d. Sell the longest duration bonds and buy those with even longer duration.
Question 31
In commodities trading, open interest at the end of a trading day is equal to
a. the number of contracts presently outstanding.
b. the advances minus the declines.
c. the net change in price from the prior day's close.
d. the number of speculative positions sold in the last 60-day period.
Question 32
In the futures markets, gains and losses in a contract's value are calculated every day and added to or subtracted from the trader's account. This procedure is called
a. checking the maintenance deposit.
b. mark-to-the-market.
c. settling.
d. checking the maintenance margin.
Question 33
Which of the following are accurate in relation to the writer of a naked call?
I. losses are limited to the strike price minus the option premium
II. losses are virtually unlimited
III. profits are virtually unlimited
IV. profits are limited to the initial option premium
a. II and IV only
b. I and IV only
c. I and III only
d. II and III only
Question 34
Which of the following statements concerning Long-term Equity Anticipation Securities (LEAPS) is correct?
a. They are options that are traded solely on the over-the-counter market.
b. They grant the right to buy or sell 1,000 shares of the underlying security.
c. They are options that are available only on individual common stocks.
d. They typically have a higher quoted price than that of standardized options.
Question 35
A T-Bill futures contract goes from a quote of 86.50 to 91.35; given this, it follows that the dollar value of a single contract went up by
a. $6,300.
b. $12,125.
c. $9,985.
d. $4,850.
Question 36
Which one of the following stocks is the LEAST likely to be found in an aggressive mutual fund?
a. stock of an unseasoned firm
b. stock with a high current dividend
c. high P/E stock
d. stock with a high rate of growth
Question 37
An investor who wants to use mutual funds as a storehouse of value, where investment capital is fairly secure and relatively free from deterioration, would do well to choose
a. high-yield corporate bond funds and growth funds.
b. equity-income funds and long-term bond funds.
c. money funds and short-term bond funds.
d. growth funds and equity-income funds.
Question 38
What is the time premium of a put with a strike price of $20 when the option price is $4 and the underlying common stock sells for $23?
a. $3
b. $4
c. $1
d. $0
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