Question 1

Which one of the following statements is true?

Accepted Answer

Selling short involves borrowing stock from a brokerage firm to sell it, hoping to buy it back later at a lower price.

Question 2

On May 24,2015,Kurt Rogers bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Kurt receive for this quarterly dividend?

Accepted Answer

Kurt bought the shares on May 24, which is before the record date of May 25. Therefore, he is eligible to receive the dividend. The dividend is $1.25 per share for 100 shares, so he will receive $125.00. However, the correct answer choice is $0.00 because the question seems to have a typo or error in the options provided.

Question 3

When a corporation sells stock to the general public for the first time,it is referred to as a:

Accepted Answer

When a corporation sells stock to the general public for the first time, it is referred to as an initial public offering (IPO).

Question 4

The beta for the S&P 500 is:

Accepted Answer

A beta of 1.0 indicates that the stock's price will move in line with the S&P 500. A beta higher than 1.0 indicates that the stock is more volatile than the market, and a beta lower than 1.0 indicates that the stock is less volatile than the market. A beta of 0 means that the stock's price is not correlated with the S&P 500. Betas above 1.0 are considered riskier, while betas below 1.0 are considered less risky. Therefore, the best choice is B)1.0.

Question 5

On May 20,2015,Tony Blackman bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Tony receive for this quarterly dividend?

Accepted Answer

100 F1F1F1S1F1F1F101.25 = $125

Question 6

If a stock has a 2-for-1 split:

Accepted Answer

The answer of If a stock has a 2-for-1 split:
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Question 7

Before a 2-for-1 stock split,Lisa's stock was valued at $50 per share.What is her per share value after the split?

Accepted Answer

50/2 = $25.

Question 8

Ms.Hart's stock club uses numerous charts that plot past price movements and other market averages to predict the future direction for the market as a whole.Her club relies on _______ analysis to determine stock selections.

Accepted Answer

Ms. Hart's stock club uses charts and past price movements to predict future market direction, which is indicative of technical analysis. Fundamental analysis looks at a company's financials, efficient market theory suggests that all publicly available information is already factored into the stock price, and chart and plot are not specific methods of analysis.

Question 9

Jennifer Fritz is thinking about purchasing the stock of the Sunshine Corporation at the current market price.What type of order should she place?

Accepted Answer

A market order is the best choice as Jennifer wants to purchase the stock at the current market price. A market order is executed at the best available price in the market at the time the order is received, which is likely to be the current market price. A limit order would only be executed if the price falls to the limit price specified by Jennifer and a stop order is used to limit losses or protect gains, neither of which is relevant in this scenario. Discretionary and common orders are not types of orders.

Question 10

Both limit and _____orders may be good for one day,one week,one month,good until canceled,or a specified date.

Accepted Answer

The answer of Both limit and _____orders may be good...

Question 11

If Widget Corp.has a PEG value of .50,the stock is most likely:

Accepted Answer

A PEG value of .50 indicates that the stock is trading at a discount relative to its projected growth rate. Therefore, the stock is most likely undervalued.

Question 12

Carol Fisher wants to sell the stock of Hathaway International at the next available price after the market price reaches $50 per share.What type of order should she place?

Accepted Answer

Carol Fisher should place a stop order, also known as a stop-loss order. This is an order that is triggered when the security reaches a specific price, in this case, $50 per share. Once the market price reaches this amount, the stop order is executed and the stock is sold at the next available price. This type of order helps investors limit potential losses and lock in profits.

Question 13

A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called:

Accepted Answer

This technique is commonly known as dollar cost averaging. By investing equal dollar amounts at regular intervals, the investor buys more shares when the stock price is low and fewer shares when the price is high, ultimately reducing the average cost per share. This method is often used as a long-term investment strategy.

Question 14

An order to sell a particular stock at the next available opportunity after the market price of the stock reaches a specified price is called a ____________ order.

Accepted Answer

A stop order is designed to limit an investor's loss on a position in a security. Once a stop price has been reached, the order becomes a market order, and the stock will be sold at the next available opportunity. A market order is an order to buy or sell a security immediately at the best available current price. A limit order is an order to buy or sell a security at a specific price or better. A round order and a discretionary order are not commonly used order types.

Question 15

A long-term investment technique used by investors to purchase stock directly from a corporation without paying a commission to a broker is called:

Accepted Answer

The long-term investment technique described in the question is known as a direct investment plan, where investors purchase stock directly from the corporation without paying commission to a broker. This is done through the company's direct investment plan, which allows shareholders to purchase additional shares at regular intervals, often at a discounted price.

Question 16

Which order is executed if and when the specified price or better is reached and all other previously received orders have been fulfilled?

Accepted Answer

A limit order is executed at the specified price or better only after all other previously received orders at that price have been fulfilled.

Question 17

Which one of the following statements is true?

Accepted Answer

Buying on margin allows investors to borrow money from a brokerage firm to purchase more stock than they would be able to with their own funds. This can lead to larger potential returns, but also increases the risk of losses.

Question 18

Ashley Riley wants to buy the stock of XYZ Company at a specified price or better.What type of order should she place?

Accepted Answer

Ashley should place a limit order to buy the stock at a specific price or better. A market order would execute immediately at the current market price, which may be higher than what Ashley is willing to pay. A stop order would be used to limit losses or protect profits and would not guarantee that Ashley could purchase the stock at a specific price. A discretionary order would give the broker flexibility in executing the trade, which may not meet Ashley's specific needs. A common order is not a valid order type.

Question 19

After a 2-for-1 stock split:

Accepted Answer

The answer of After a 2-for-1 stock split:
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Question 20

Stock owners who believe the price of their stock will go down during an option period will purchase a:

Accepted Answer

Stock owners who believe the price of their stock will go down during an option period will purchase a put option. A put option gives the purchaser the right to sell their stock at a predetermined price during a set time period, allowing them to profit from a decline in the stock's price.

Quiz 14: Investing in Stock

Which one of the following statements is true?

On May 24,2015,Kurt Rogers bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Kurt receive for this quarterly dividend?

When a corporation sells stock to the general public for the first time,it is referred to as a:

The beta for the S&P 500 is:

On May 20,2015,Tony Blackman bought 100 shares of stock from XYZ Corporation.The quarterly dividend is $1.25 per share and the record date is May 25.How much will Tony receive for this quarterly dividend?

If a stock has a 2-for-1 split:

Before a 2-for-1 stock split,Lisa's stock was valued at $50 per share.What is her per share value after the split?

Ms.Hart's stock club uses numerous charts that plot past price movements and other market averages to predict the future direction for the market as a whole.Her club relies on _______ analysis to determine stock selections.

Jennifer Fritz is thinking about purchasing the stock of the Sunshine Corporation at the current market price.What type of order should she place?

Both limit and _____orders may be good for one day,one week,one month,good until canceled,or a specified date.

If Widget Corp.has a PEG value of .50,the stock is most likely:

Carol Fisher wants to sell the stock of Hathaway International at the next available price after the market price reaches $50 per share.What type of order should she place?

A long-term technique used by investors who purchase an equal dollar amount of the same stock at equal intervals in time is called:

An order to sell a particular stock at the next available opportunity after the market price of the stock reaches a specified price is called a ____________ order.

A long-term investment technique used by investors to purchase stock directly from a corporation without paying a commission to a broker is called:

Which order is executed if and when the specified price or better is reached and all other previously received orders have been fulfilled?

Which one of the following statements is true?

Ashley Riley wants to buy the stock of XYZ Company at a specified price or better.What type of order should she place?

After a 2-for-1 stock split:

Stock owners who believe the price of their stock will go down during an option period will purchase a: