Deck 20: Investments

Question 1

____________________ are the amount of dividends that accumulate and are owed to cumulative preferred shareholders for past years in which no dividends were paid.

Answer 1

Dividends in arrears

Question 2

Given the following stock quotation, find the lowest price during the last year. $$\begin{array} { l l l l l l l l l } \hline\text { Intel, Corp. INTC } & 18.23& 18.52&17.81&0.19 &1.05&135,056,271&24.37&17.81&0.063\\\hline\end{array}$$

A) 24.37
B) 17.81
C) 11
D) 135.05

Answer 2

17.81

Question 3

____________________ bonds are those that the issuer has the right to repurchase before the maturity date.

Answer 3

Callable

Question 4

Hopen Consulting has 310,000 shares of $100 par value, 8% cumulative preferred stock and 2,650,000 shares of common stock. Although no dividend was declared last year, a $6,500,000 dividend has been declared this year. After finding the amount of dividends due the preferred shareholders, calculate the dividend per share of common stock.

A) $0.58
B) $1.44
C) $0.62
D) $0.51

Question 5

Given the following stock quotation, find the highest price during the last year. $$\begin{array} { l l l l l l l l l } \hline\text { Pfizer } & \text { PFE } & 15.98& 16.12&10.09&0.19 & 38,227,823& 20.36 &14.00&0.72 \\\hline\end{array}$$

A) 20.36
B) 15
C) 14
D) 38.227

Question 6

A type of preferred stock that may be exchanged for a specified number of common shares in the future is called ____________________ preferred.

Question 7

The percentage measure of how well an investment is doing and is often used as the basis for comparison with other investments is the ____________________.

Question 8

An investment strategy that is a mixture of stocks, bonds, cash equivalents, and other types of investments is called a(n) ____________________ portfolio.

Question 9

When a bond is selling for more than its par value, it is said to be selling at a(n) ____________________.

Question 10

The dollar value of one share of a mutual fund's stock is called the ____________________ value.

Question 11

____________________ are a distribution of a company's profits to its shareholders.

Question 12

Given the following stock quotation, find the symbol for the stock. $$\begin{array} { l l l l l l l l l } \text { Boeing } & \text { BA } & 80.12 & 81.09 & 79.20 & 81.00 & 1.22 & 1.53 & 3,416,237 \\\hline\end{array}$$

A) BN
B) BNG
C) Boeing
D) BA

Question 13

The board of directors of Streamlined Airlines has declared a dividend of $4,300,000. The company has 400,000 shares of preferred stock that pay $0.70 per share and 2,750,000 shares of common stock. After finding the amount of dividends due the preferred shareholders, calculate the dividend per share of common stock. (Round your answer to the nearest cent if necessary)

A) $11.50
B) $1.46
C) $1.92
D) $1.79

Question 14

Corporations that are investment pools of money with a wide variety of investment goals are called ____________________.

Question 15

____________________ are bonds that are backed only by the general credit of the issuing corporation.

Question 16

The board of directors of Midwest Foods has declared a dividend of $3,500,000. The company has 300,000 shares of preferred stock that pay $2.85 per share and 2,500,000 shares of common stock. After finding the amount of dividends due the preferred shareholders, calculate the dividend per share of common stock.

A) $1.06
B) $1.57
C) $13.50
D) $4.50

Question 17

Given the following stock quotation, find the yield percent. $$\begin{array} { l l l l l l l l l } \hline\text { Chevron Corp CVX } &73.89&75.04&72.93&1.60&2.18&8,755,631&83.41&66.83&2.88\\\hline\end{array}$$

A) 2.88%
B) 9%
C) 3.84%
D) 8.75%

Question 18

A(n) ____________________ is one unit of stock or ownership in a corporation.

Question 19

Saunders and Flimsy Partnership paid dividends of $0.27 and $0.15 per share last year. If yesterday's closing price was $12.27, what is the current yield on the stock? (Round to the nearest tenth)

A) 3.4%
B) 2.6%
C) 18.6%
D) 2.9%

Question 20

The board of directors of Clear Communications has declared a dividend of $2,500,000. The company has 240,000 shares of preferred stock that pay $2.10 per share and 2,600,000 shares of common stock. After finding the amount of dividends due the preferred shareholders, calculate the dividend per share of common stock.

A) $0.37
B) $1.89
C) $0.69
D) $0.77

Question 21

Suppose you own stock in Beach Front Resort Inc. which had earnings of $2.10 per share last year. If yesterday's closing price was $58.80, what is the price-earnings ratio of the stock? (Round to the nearest whole number)

A) 4
B) 0.04
C) 2.8
D) 28

Question 22

You sell 30 bonds with a coupon rate of 8.125% and a current market price of $$108 \frac { 1 } { 2 }$$ . The commission charge is $10.00 per bond. The date of the transaction is 88 days since the last interest payment. What are your total proceeds?

A) $32,845.83
B) $32,896.50
C) $32,837.70
D) $32,887.50

Question 23

Given the following bond quotation, find the closing price. $$\begin{array} { l l l l l l l l l } \hline\text { Morgan Stanley } &\text { MS.TJ }&5.05\%&\text {JAN 2015}&101.656&101.392&101.628&-0.052&4.969\%\\\hline\end{array}$$

A) $505.00
B) $1,016.56
C) $1,013.92
D) $1,016.28

Question 24

Great Fruit Inc. paid a dividend of $5.10 per share last year. If yesterday's closing price was $42.38, what is the current yield on the stock? (Round to nearest tenth)

A) 1.2%
B) 12.0%
C) 7.2%
D) 6.3%

Question 25

Bobby bought 550 shares of stock at $61.25 per share. His broker charges 4% commission for round lots and 5% for odd lots. Calculate the total cost of the stock purchase.

A) $35,065.63
B) $39,258.65
C) $33,710.00
D) $35,371.88

Question 26

Given the following bond quotation, find the coupon rate. $$\begin{array} { l l l l l l l l l } \hline\text { DirectTV HLDS} &\text { DTV.GV }&4.600\%&\text {FEB 2021}&101.129&101.342&101.744&+0.994&4.521\%\\\hline\end{array}$$

A) 4.521%
B) 4.600%
C) 101.9%
D) 101.7%

Question 27

Suppose you own stock in National Advertising which had earnings of $2.50 per share last year. If yesterday's closing price was $41.50, what is the price-earnings ratio of the stock? (Round to the nearest whole number)

A) 6:1
B) 1:17
C) 4:1
D) 17:1

Question 28

Shaylash bought 250 shares of stock at $31.38 per share. Several months later he sold the stock at $45.65 per share. His broker charges 4% commission for round lots and 5% for odd lots. Calculate the gain or loss on the transaction. (Show loss in parentheses)

A) $10,933.19
B) $8,174.49
C) $2,758.69
D) ($2,758.69)

Question 29

Given the following bond quotation, find the coupon rate. $$\begin{array} { l l l l l l l l l } \hline\text { CIT GP} &\text { CIT.GBC }&7.000\%&\text { MAY 2013}&100.855&96.096&100.750&+2.000&6.948\%\\\hline\end{array}$$

A) 6.948%
B) 7.000%
C) 96.096%
D) 2.000%

Question 30

Cornware Distributing paid a dividend of $0.08, $0.21, $0.11 and $0.17 per share respectively last year. If yesterday's closing price was $35.40, what is the current yield on the stock? (Round to the nearest tenth)

A) 3.4%
B) 1.6%
C) 4.5%
D) 5.2%

Question 31

You purchase 10 bonds with a coupon rate of 9% and a current market price of 101.125. The commission charge is $5.00 per bond. The date of the transaction is October 1, and the bond pays interest on January 1 and July 1. What is your total purchase price?

A) $10,392.50
B) $10,400.00
C) $10,395.10
D) $10,391.90

Question 32

Shares of Lorne and Greene Manufacturing now sell for $64. If the company had earnings per share of $3.70 last year, calculate the price-earnings ratio of the stock. (Round to nearest whole number)

A) 51:1
B) 23:1
C) 25:1
D) 17:1

Question 33

Light Fixtures Inc. paid a dividend of $7.20 per share last year. If yesterday's closing price was $88.24, what is the current yield on the stock? (Round to nearest tenth)

A) 8.2%
B) 11.0%
C) 5.2%
D) 2.3%

Question 34

You purchase 150 shares of stock at $40.88 per share. Several months later you sell the shares at $32.50. Your broker charges 4% commission for round lots and 5% for odd lots. Calculate the gain or loss on the transaction. (If loss, enclose in parenthesis)

A) ($1,924.69)
B) ($1,311.47)
C) ($1,733.97)
D) $2,145.87

Question 35

Find the total purchase price of 35 bonds that have a coupon rate of 4.50% and a current market price of 102.375. The commission charge is $5.00 per bond. The date of the transaction is April 1, and the bond pays interest on January 1 and July 1.

A) $30,225
B) $36,400
C) $30,226
D) $30,426

Question 36

Lakeesha bought 300 shares of stock at $48.25 per share. Her broker charges 3% commission for round lots and 4% for odd lots. Calculate the total cost of the stock purchase.

A) $15,025.63
B) $14,909.25
C) $13,820.00
D) $25,115.88

Question 37

Suppose you own stock in the Golf Tour Corporation which had earnings of $0.90 per share last year. If yesterday's closing price was $33.13, what is the price-earnings ratio of the stock? (Round to nearest whole number)

A) 33:1
B) 37:1
C) 22:1
D) 38:1

Question 38

Lance bought 120 shares of stock at $25.28 per share. Several months later he sold the stock at $24.70 per share. His broker charges 3% commission for round lots and 4% for odd lots. Calculate the gain or loss on the transaction. (Show loss in parentheses)

A) $3,139.66
B) $3,033.60
C) $259.52
D) ($259.52)

Question 39

Helping Hand Industries paid a dividend of $0.40 per share last year. If yesterday's closing price was $19.05, what is the current yield on the stock? (Round to nearest tenth)

A) 17.2%
B) 6.3%
C) 2.1%
D) 1.6%

Question 40

You purchase 30 bonds with a coupon rate of 5.875% and a current market price of 89. The commission charge is $15.00 per bond. The date of the transaction is September 1, and the bond pays interest on January 1 and July 1. What is your total purchase price?

A) $27,200.00
B) $27,590.63
C) $27,800.00
D) $27,791.60

Question 41

Suppose you own a mutual fund that has 10,500,525 shares outstanding. If its total assets are $37,500,020 and its liabilities are $12,375,375, find the net asset value of the fund.

A) $3.20
B) $2.39
C) $3.71
D) $3.05

Question 42

A mutual fund has total assets of $60,500,005 and liabilities of $7,987,654. If there are 10,123,456 shares outstanding, what is the net asset value of the fund?

A) $4.60
B) $5.70
C) $5.19
D) $5.00

Question 43

Suppose you own a mutual fund which has 11,326,555 shares outstanding. If its total assets are $70,111,050 and its liabilities are $12,444,100, find the net asset value of the fund.

A) $5.09
B) $5.13
C) $5.36
D) $5.98

Question 44

Given the following mutual fund quotation, find the change in the net asset value.

$$\begin{array} { l l l l l l l l l } \text { John Hancock Fund A} &\text { ClassicVal p}&\text { PZFVX} &13.70&+0.03&-4.8&-15.8\end{array}$$

A) 13.70%
B) ?4.8%
C) +0.03%
D) -15.8%

Question 45

Find the current yield of a bond whose coupon rate is listed as 5.875% and currently selling at a discount of 92.375. (Round to the nearest tenth percent)

A) 7.1%
B) 6.6%
C) 6.3%
D) 6.4%

Question 46

Find the current yield of a bond whose coupon rate is listed as 9.375% and currently selling at a premium of 100.875. (Round to the nearest tenth percent)

A) 9.3%
B) 9.4%
C) 10.0%
D) 10.1%

Question 47

Ricardo invested a lump sum of $10,000 in a mutual fund with an offer price of $12.04. How many shares did he purchase? (Round to the nearest thousandth)

A) 1,204.000
B) 830.565
C) 955.874
D) 637.121

Question 48

A mutual fund has total assets of $39,333,444 and liabilities of $6,753,789. If there are 11,521,000 shares outstanding, what is the net asset value of the fund?

A) $3.02
B) $3.85
C) $2.83
D) $2.16

Question 49

Suppose that you own a bond with a coupon rate of 8% and currently selling at a premium of 101.75. What is the current yield? (Round to the nearest tenth percent)

A) 7.9%
B) 9.1%
C) 8.5%
D) 8.9%

Question 50

A mutual fund has an offer price of $14.32. If you invested a lump sum of $5,525, how many shares did you purchase? (Round to the nearest thousandth)

A) 518.266
B) 616.000
C) 489.651
D) 385.824

Question 51

Find the current yield of a bond whose coupon rate is listed as 6.125% and currently selling at a discount of 87.50. (Round to the nearest tenth percent)

A) 7.8%
B) 7.0%
C) 9.3%
D) 10.2%

Question 52

Chloe invested a lump sum of $24,000 in a mutual fund with an offer price of $8.05. How many shares did she purchase? (Round to the nearest thousandth)

A) 1,600.500
B) 1,633.340
C) 3,690.342
D) 2,981.366

Question 53

Given the following mutual fund quotation, find the net asset value (NAV). $$\begin{array} { l l l l l l l l l } \hline\text { Fidelity Invest} &\text { Contra }&\text { FCNTX }&56.46&+0.07&-3.0&-5.0\\\hline\end{array}$$

A) FCNTX
B) 56.46
C) +0.07
D) -5.0

Question 54

You purchase a mutual fund at an offer price of $11.28 per share. If the net asset value is $10.74, find the sales charge percent. (Round to the nearest tenth)

A) 5.0%
B) 95.0%
C) 4.8%
D) 95.2%

Question 55

You purchase a mutual fund at an offer price of $10.43 per share. If the net asset value is $9.99, find the sales charge percent. (Round to nearest tenth)

A) 5.8%
B) 4.2%
C) 5.2%
D) 4.4%

Question 56

A mutual fund has an offer price of $11.98 per share and a net asset value of $11.29. What is the sales charge percent? (Round to the nearest tenth)

A) 5.8%
B) 6.1%
C) 93.9%
D) 94.2%

Question 57

A mutual fund has an offer price of $7.83 per share and a net asset value of $7.38. What is the sales charge percent? (Round to nearest tenth)

A) 5.7%
B) 6.1%
C) 4.9%
D) 7.4%

Question 58

Given the following mutual fund quotation, find the YTD percent return on investment: $$\begin{array} { l l l l l l l l l } \hline\text { Vanguard Index Funds} &\text { 500 Index }&\text {VFINX} &96.95&+0.04&-4.7&-8.7\\\hline\end{array}$$

A) 500
B) 96.95
C) -4.7
D) -8.7

Question 59

Brian invested a lump sum of $10,000 in a mutual fund with an offer price of $6.03. How many shares did he purchase? (Round to the nearest thousandth)

A) 1,600.500
B) 1,658.375
C) 1,685.375
D) 6,300.000

Question 60

Given the following mutual fund quotation, find the 3-year percent change on investment. $$\text { Fidelity Invest GoldInst r FGDDX } 49.26 \quad + 0.69 \quad + 16.3 \quad + 17.7$$

A) 49.26%
B) 0.69%
C) +16.3%
D) +17.7%

Question 61

Calculate the preferred and common dividend per share for the following.

Question 62

Calculate the missing information for the stocks, rounding to the nearest tenth of a percent for current yield and whole number for price-earnings ratio.

Question 63

Calculate the preferred and common dividend per share for the following.

Question 64

A mutual fund has an offer price of $9.42 per share and a net asset value of $9.04. What is the sales charge percent? (Round to nearest tenth)

A) 4.2%
B) 5.1%
C) 3.9%
D) 8.4%

Question 65

Calculate the preferred and common dividend per share for the following.

Question 66

The board of directors of Clarian Motels has declared a dividend of $3,000,000. The company has 150,000 shares of preferred stock that pay $1.20 per share and 1,800,000 shares of common stock. After finding the amount of dividends due the preferred shareholders, calculate the dividend per share of common stock. (Round your answer to the nearest cent if necessary)

A) $0.44
B) $2.99
C) $1.57
D) $0.75

Question 67

Calculate the preferred and common dividend per share for the following.

Question 68

A mutual fund has an offer price of $7.75. If you invested a lump sum of $12,000, how many shares did you purchase? (Round to the nearest thousandth)

A) 1,548.387
B) 1,584.387
C) 9,300.000
D) 12,000.000

Question 69

Calculate the missing information for the stocks, rounding to the nearest hundredth for earnings per ratio and nearest tenth of a percent for current yield.

Question 70

Calculate the missing information for the stocks, rounding to the whole number for price-earnings ratio.

Question 71

You purchased 3,000 shares of a mutual fund at an offer price of $7.10 per share. Several months later you sold the shares for $8.45 per share. During the time you owned the shares, the fund paid a dividend of $0.29 per share. What was your return on investment? (Round to the nearest tenth)

A) 16.0%
B) 19.0%
C) 23.1%
D) −16.0%

Question 72

Sabrine purchased 4,500 shares of a mutual fund at an offer price of $8.98 per share. Later, she sold the investment for $7.39 per share. During the time she owned the shares, the fund paid a dividend of $0.58 per share. What was her return on her investment? (Round to the nearest tenth)

A) −9.5%
B) −11.2%
C) −1.2%
D) 6.6%

Question 73

Calculate the missing information for the stocks, rounding to the nearest hundredth for earnings per share and annual dividend.

Question 74

Calculate the missing information for the stocks, rounding to the nearest tenth of a percent for current yield and whole number for price-earnings ratio.

Question 75

Calculate the missing information for the stocks, rounding to the nearest hundredth for current price per share and whole number for price-earnings ratio.

Question 76

A mutual fund has an offer price of $7.42 per share and a net asset value of $7.02. What is the sales charge percent? (Round to the nearest tenth)

A) 2.8%
B) 4.1%
C) 92.8%
D) 5.7%

Question 77

Calculate the preferred and common dividend per share for the following.

Question 78

Dane purchased 3,000 shares of a mutual fund at an offer price of $6.03 per share. Later, he sold the investment for $3.64 per share. During the time Dane owned the shares, the fund paid a dividend of $0.52 per share. What was his return on investment? (Round to nearest tenth percent)

A) −31.0%
B) −37.1%
C) +44.3%
D) +41.2%

Question 79

Tamara purchased 1,500 shares of a mutual fund at an offer price of $7.08 per share. Later she sold the investment for $10.02 per share. During the time Tamara owned the shares, the fund paid a dividend of $0.21 per share. What was her return on investment? (Round to nearest tenth percent)

A) 44.5%
B) 5.1%
C) 4.5%
D) 9.8%

Question 80

Calculate the missing information for the stocks, rounding to the nearest tenth of a percent for current yield and whole number for price-earnings ratio.