QUESTTUN 4 Each stock's rate of return in a given year consists of a dividend yield (which might be zero) plus a capital gains yield (which could be positive, negative, or zero). Such returns are calculated for all the stocks in the S&P 500. A weighted average of those returns, using each stock's total market value is then calculated, and that average return is often used as an indicator of the "return on the market." True False QUESTION 5 Note that there is an overlap between the T/F and multiple-choice questions, as some of the T/F statements are used in multiple- choice questions Multiple Choice: True/False A financial intermediary is a corporation that takes funds from investors and then provides those funds to those who need capital. A bank that takes in demand deposits and then uses that money to make long-term mortgage loans is one example of a financial intermediary True False QUESTION 6 The annual rate of return on any given stock can be found as the stock's dividend for the year plus the change in the stock's price during the year, divided by its beginning-of-year price. True False