New Semester
Started
Get
50% OFF
Study Help!
--h --m --s
Claim Now
Question Answers
Textbooks
Find textbooks, questions and answers
Oops, something went wrong!
Change your search query and then try again
S
Books
FREE
Study Help
Expert Questions
Accounting
General Management
Mathematics
Finance
Organizational Behaviour
Law
Physics
Operating System
Management Leadership
Sociology
Programming
Marketing
Database
Computer Network
Economics
Textbooks Solutions
Accounting
Managerial Accounting
Management Leadership
Cost Accounting
Statistics
Business Law
Corporate Finance
Finance
Economics
Auditing
Tutors
Online Tutors
Find a Tutor
Hire a Tutor
Become a Tutor
AI Tutor
AI Study Planner
NEW
Sell Books
Search
Search
Sign In
Register
study help
business
focus on personal finance
Personal Finance 4th Canadian Edition Jeffry Madura, Hardeep Gill - Solutions
Given the following mutual fund price quotation, determine which of the following statements most accurately reflects the data.$ $ Yr Fund NAVPS Ch %Ch ABC Health Care Fund 21.95 +0.11 −1.1a. ABC Health Care Fund has a net asset value per share of$21.95. The net change in the NAVPS during the
A mutual fund that invests only in shares of gold mining companies would be called a:a. Growth fund.b. Small-cap fund.c. Canadian equity fund.d. Sector fund.
In order to select appropriate mutual funds for yourself, you should determine your investment objectives and evaluate your risk tolerance. Then, the final step is to:a. Review and compare key information from the relevant Fund Facts documents.b. Review and compare key information from the
When you initially purchase a mutual fund, a Fund Facts document must be provided to you within of your purchase.a. 24 hoursb. three business daysc. seven daysd. 48 hours
If Rebecca’s mutual fund has a sales charge schedule saying that if the fund is sold within the first year, the sales charge is 6 percent and if it is sold in the third year, the sales charge becomes 4.5 percent, Rebecca’s mutual fund has a:a. Low load.b. Discount fee.c. Broker commission.d.
If Raymond does not want to pay any fees to invest in mutual funds, he should pick:a. No-load mutual funds.b. Front-end load mutual funds.c. Back-end load mutual funds.d. Zero-fee mutual funds.
“Since they engage in less trading than most other mutual funds, they generate a limited amount of capital gains that must be distributed to shareholders.” This statement refers to which of the following types of funds?a. Bond fundsb. Dividend fundsc. Index fundsd. Growth funds
mutual funds sell shares directly to investors and redeem those shares whenever investors wish to redeem them.a. Open-endb. Equityc. Bondd. Closed-end
A mutual fund that aggressively seeks capital growth:a. Will have an MER that is approximately the same as a Tbill fund.b. Will have an MER that is higher than a global fund.c. Will have an MER similar to that of a fixed-income fund.d. Will have an MER that reflects the increased costs of research.
Which of the following is true about MERs?a. MERs only include manager and sales expenses.b. Mutual funds with lower MERs tend to outperform those with higher MERs.c. All types of mutual funds have similar MERs.d. You need to subtract the MER from the posted return to figure out performance.
Mutual funds, which sell units directly to investors and repurchase units from investors who want to sell, are called:a. Open-market funds.b. Open-end funds.c. Closed-end funds.d. Fair value funds.
All of the following are advantages of owning a mutual fund, except:a. You can invest in a broadly diversified portfolio with a small initial investment.b. Your investments reflect the decisions of experienced professionals who have access to the best research available.c. Mutual funds simplify the
True or False? With respect to an interest rate strategy, you would select long-term bonds if you expect interest rates to increase.
True or False? Reinvestment risk increases as interest rates decrease.
True or False? Bonds with longer terms to maturity are more sensitive to interest rate movements than bonds that have short terms remaining until maturity.
True or False? A bond is more likely to be exposed to call risk when interest rates are rising.
True or False? Real return bonds protect an investor from real interest rate risk.
True or False? A put feature allows an investor to redeem the bond at its face value before it matures.
True or False? If you wish to sell a bond that has a coupon rate of 8 percent when new bonds being sold at par value are offering a coupon rate of 9 percent, you will have to sell your bond for less than par value in order to attract investors.
True or False? Strip bonds are always sold at a discount to their par value.
True or False? A sinking fund is a pool of money that is set aside to repurchase a set amount of bonds in a set period of time.
True or False? Banker’s acceptances are short-term debt securities issued by large firms that are guaranteed by the issuing firm.
True or False? The risk of default by the issuer of a provincial bond will vary depending on the province that issued the bond.
True or False? Bonds are long-term debt securities secured only by a promise to pay.
True or False? Crown corporation bonds are guaranteed by the province in which they are issued.
True or False? A bond that is trading at a price below its par value is said to be trading at a discount.
True or False? The coupon payments for a bond are normally payable quarterly.
Darvin and Kim would like to purchase a portfolio of bonds that will mature when their children are ready to attend a postsecondary institution. What would be the most appropriate bond investment strategy given their objectives?a. Interest rate strategyb. Passive strategyc. Bond laddering
To minimize the effects of default risk, an investor should choose which one of the following corporate bonds?a. AAA-rated corporate bonds with the shortest term to maturityb. AA-rated short-term corporate bonds with the shortest term to maturityc. AAA-rated long-term corporate bonds with the
High-yield (junk) bond funds focus on relatively risky bonds issued by firms. These funds are most susceptible to what kind of risk?a. Management riskb. Exchange rate riskc. Default riskd. Market fluctuation risk
How much interest does an ATT Ltd. bond pay annually, given the following information? $1000 par value, maturity Dec 22, 2023, semi-annual coupon 7.75 percent, price $105.50, and yield 7.4 percent.a. $7.50b. $77.50c. $7.40d. $74.00
What is the purchase price of a $10 000, 3.5 percent bond with semi-annual coupons redeemable at 108 in 7 years if the bond is bought to yield 2.5 percent compounded semi-annually? HINT:The bond will be redeemed prior to maturity at 108.a. $10 011.39b. $11 310.82c. $10 800.00d. $10 638.53
Calculate the present value of a $1000 par value bond that has five years until maturity and a coupon rate of 8 percent, payable semi-annually. New $1000 par value bonds offer a coupon rate of 6 percent.a. $1085.20b. $915.48c. $1045.79d. $1084.25
With respect to bond valuation, which of the following statements is true?a. A bond’s value is determined as the future value of the future cash flows to be received by the investor, which are the periodic coupon payments and the principal payment at maturity.b. A bond’s value is determined as
The amount returned to the investor when a bond matures is called:a. Principal.b. Interest gain.c. Capital gain.d. Terminal value.
The risk that you will be forced to sell your bond back to the issuer prior to maturity is referred to as:a. Call risk.b. Default risk.c. Interest rate risk.d. Economic risk.
Jan buys a bond with a face value of $1000 at a purchase price of$109.40. The bond has a semi-annual coupon payment of 10 percent. If she holds the bond until maturity in six years, find its yield to maturity if interest is compounded semi-annually?a. 10.0 percentb. 8.0 percentc. 8.6 percentd. 9.0
Real return bonds protect you from inflation risk by:a. Increasing your coupon payments every six months.b. Adjusting the par value of the bond for changes in the inflation rate.c. Offering a term to maturity that will result in a very safe, low-risk investment.d. All of the above.
Which of the following short-term debt securities is issued by the Government of Canada?a. Banker’s acceptancesb. Strip bondsc. Commercial paperd. T-bills
Bonds that may be exchanged for common stock at the option of the bondholders are called:a. Option bonds.b. Convertible bonds.c. Callable bonds.d. Stock bonds.
An investor may be interested in investing in a Government of Canada bond because:a. They are a safe investment.b. They are available with a term to maturity of anywhere between 1 and 30 years.c. They can be sold easily in the secondary market.d. All of the above.
Which of the following is not a bond feature that is desirable for bond investors?a. Put featureb. Convertible featurec. Call featured. Extendible feature
True or False? A firm’s possible future performance can only be assessed by conducting an analysis of the firm, the economy, and the industry within which the firm operates.
True or False? A limitation of intrinsic valuation models is that forecasting future dividends and earnings is too easy.
True or False? A relative valuation model attempts to find the value of an investment by focusing on the amount of future cash flows generated by the investment.
True or False? Fiscal policy refers to how the government imposes taxes on individuals and corporations and how it spends tax revenues.
True or False? The rapid and ongoing consolidation in global capital markets has been fuelled by the demutualization of stock exchanges.
True or False? A convenient and effective method of measuring performance is to compare the return on your stock to the return on that stock in the past.
True or False? An on-stop order, which is a special form of limit order, is an order to execute a transaction when the stock price reaches a specified level.
True or False? One of the advantages of relying on analyst recommendations is that many studies have shown that these recommendations often lead to better performance than the stock market in general.
True or False? The OTC market was designed for companies that do not meet the listing requirements of the TSX or the TSX Venture Exchange.
True or False? An efficient stock market is a market in which stock prices reflect most of the information available to investors.
True or False? High-priced stocks of well-performing firms are a good investment for the future.
True or False? One of the reasons top managers may inflate the revenue of their firm is to be able to sell their shares at a higher price at some point in the future.
True or False? The average collection period can be used to determine the average age of accounts payable. A higher number relative to the industry norm means a longer collection period, which is less efficient.
True or False? Many firms prefer to borrow funds rather than issue stock to avoid placing upward pressure on the stock price.
True or False? Among other things, a firm’s annual report includes a message from the chief environmental officer (CEO).
The Bank of Canada uses policy to influence interest rates.a. publicb. fiscalc. monetaryd. financial
The advantage of a market order is that:a. You are assured that your order will be executed quickly.b. You can control the price at which you are willing to purchase the stock.c. You can specify that you want the full number of shares to be traded or none at all.d. Your order will expire if it is
Whenever you place an order to buy or sell a stock, you must specify all of the following, except:a. The number of shares you wish to purchase.b. The name of the firm selling you the stock.c. Whether you are buying or selling the stock.d. The name of the stock.
Investors who wish to trade options and futures would place their orders through which of the following exchanges?a. Toronto Stock Exchangeb. Winnipeg Stock Exchangec. TSX Venture Exchanged. Montreal Exchange
Which of the following is not a limitation of the P/E method?a. Forecasting earnings is difficult.b. It is subject to error if it is based on an overestimate of revenues.c. It is difficult to determine the proper multiple that should be used to value a stock.d. The results will vary depending on
Which of the following methods represents an application of the technical analysis method for evaluating stocks?a. You will purchase a stock if its price rises for three consecutive days.b. You will purchase a stock if its price–earnings (P/E) ratio is 15 or lower.c. You will purchase a stock if
In general, stocks perform better when interest rates are low. This statement is true because low interest rates normally will result in all of the following, excepta. Firms tend to be more willing to expand.b. Investors tend to shift more of their funds into bonds to take advantage of interest
What is the return on assets for a firm that has a gross profit of$1.2 million, an operating profit of $550 000, a net profit of $200 000, short-term assets of $1 million, and long-term assets of $5 million?a. 3.3 percentb. 20 percentc. 4 percentd. 9.2 percent
What is gross domestic product (GDP)?a. A measure of the total market value of all products and services produced in Canada by Canadiansb. A measure of the total market value of all products and services produced by Canadiansc. A measure of the total market value of all products and services
Which of the following situations provides an example of how accounting methods can be used to inflate revenue?a. A firm uses a lenient policy that allows customers to cancel their orders. The firm does not count cancelled orders as revenue.b. A publisher of a magazine receives three-year
Rebecca would like to purchase a stock on margin in her margin account. Currently, the stock she is considering is trading at $18 per share and she would like to purchase 600 shares. What is her margin requirement if the margin rate is 30 percent and her brokerage firm is willing to lend her 70
A firm has a high degree of if it has a large amount of assets that can be easily converted to cash and has a relatively small amount of short-term liabilities.a. efficiencyb. financial leveragec. liquidityd. profitability
All of the following are pieces of information displayed in a stock quotation, except:a. The value of the stock based on the value of discounted dividends.b. The price at the end of the day when the stock market closes (Close).c. The daily high at which the stock was traded (Day high).d. The ticker
Under which of the following circumstances would a market maker earn money on an executed order?.a. When the ask price is greater than the bid price.b. When the bid price is greater than the ask price.c. When the bid price is the same as the ask price.d. When the bid price is less than the ask
A high-quality stock exchange is characterized by all of the following, except:a. A small difference between the bid price and the ask price.b. A large volume of shares being offered for purchase or sale with each trade request.c. A large number of venture capitalists acting as market makers.d. A
True or False? If your portfolio is performing poorly, you should increase the risk of your portfolio in order to recover your losses as quickly as possible.
True or False? When economic conditions weaken, most stocks tend to perform poorly.
True or False? An investment that has the potential to rise substantially in value also has the potential to decline substantially in value.
True or False? If you have aversion to risk, you should invest in small-cap mutual funds.
True or False? To reduce your exposure to stock market risk, you could invest in either long-term debt securities or money market securities.
True or False? The returns on stocks and the returns on bonds are highly correlated.
True or False? Portfolio construction involves the selection of investments that exhibit positive correlation.
True or False? Investors expect a higher return for taking on additional risk.
True or False? An investment with a high standard deviation is more likely to experience a large gain or a small loss in a given period.
True or False? A poorly managed company that suffers a decrease in its stock price is an example of systematic risk.
True or False? Real estate can be rented to generate income in the form of rent payments. In addition, investors may earn a capital gain if they sell the property for a higher price than they paid for it.
True or False? The price of preferred stock is not as volatile as the price of common stock.
True or False? Value stocks represent the stocks of firms with substantial growth opportunities.
True or False? The secondary market facilitates the trading of existing securities by enabling investors to sell their shares at any time.
True or False? Common stock refers to a certificate issued by a firm to raise funds that entitles shareholders to first priority to receive dividends.
Which of the following is not a common investment mistake?a. Making decisions based on realistic goals.b. Borrowing to invest.c. Taking risks to recover losses from previous investments.d. None of the above. All of these choices represent common investment mistakes.
Your current investment portfolio is equally diversified across stocks, bonds, and real estate. You have decided to reposition your portfolio based on your expectations about economic conditions. For the upcoming year, you expect stock market conditions to be weak, interest rates to decrease, and
Lee Ann would like to diversify her individual stock portfolio with other investments. Currently, she owns a portfolio of five stocks.Which of the following investments would you be least likely to recommend to Lee Ann in order to help her achieve her goal?a. A bondb. Real estatec. An income
To diversify your portfolio against weak economic conditions in Canada, it is important to diversify your stocks across:a. The Atlantic Ocean.b. Industries.c. Countries.d. Sectors.
When investment A performs well, investment E does poorly.When A performs poorly, E does well. This is referred to as:a. Positive correlation.b. Negative correlation.c. Insignificant correlation.d. Rapid correlation.
With respect to investment return, the benefits of portfolio diversification include:a. A portfolio of investments will result in a smoother trend of returns since returns are averaged among the investments in the portfolio.b. On average, the range of returns of a portfolio of investments is less
You can reduce your investment risk most effectively through:a. Asset allocation.b. Limiting the time horizon.c. Diversifying stocks.d. Maximizing the beta.
Which of the following statements regarding the trade-off between risk and return is incorrect?a. Since the prices of risky investments fluctuate substantially, it is dangerous to invest in a risky investment when you know that you will be selling that investment in the near future.b. A risk
Investment risk refers to:a. The risk premium in the markets.b. Beta.c. The risk of investments dropping in value.d. Volatility in investment returns.
Fernando purchased 1500 shares of Johnson Enterprises Inc. for$23 per share in 2006. During 2007, Johnson Enterprises paid a dividend of $1 per share. Fernando sold his shares in Johnson Enterprises for $26 per share at the end of 2007. What was his investment return during the holding period?
If you wish to have a direct voice in the running of a company, you should purchase:a. Directorships.b. Debentures.c. Common stock.d. Preferred stock.
The difference between common and preferred stock is that preferred stock:a. May or may not receive dividends.b. Has predictable income and more safety.c. Has greater potential for capital appreciation.d. Is issued more frequently than common stock.
Investing in growth stocks usually refers to:a. Younger companies paying large dividends.b. Large companies paying large dividends.c. Younger companies with potential for large capital gains.d. Any company with a market expansion strategy.
Showing 100 - 200
of 6578
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
Last
Step by Step Answers
Get 50% OFF
Claim Now
