Question 1

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What is inflation?

Select one:
a.
The number of times something happens to money.

b.
The rise in the general level of prices.

c.
The projected value of an investment at the end of a specified time frame.

d.
The uncertainty the return on an investment will deviate from what is expected.
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Question 2
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Which of the following investment tools is considered to be a speculative investment?

Select one:
a.
Futures

b.
Real Estate
 c.
Savings Bond

d.
Mutual Fund
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Question 3
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What is a bond?

Select one:
a.
A type of investment that is only offered by depository institutions

b.
A type of Certificate of Deposit with a higher than average interest rate

c.
A type of debt that a company issues to investors for a specified amount of time

d.
A share of ownership in a company
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Question 4
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 Question text
A growth stock is associated with a company:

Select one:
a.
Which dominates its respective industry and has a good company management reputation

b.
With a steady stream of income paying high dividends and retaining only a small portion of
profits

c.
That is new with a consistent record of relatively rapid growth and earnings

d.
With a spotty earnings pattern but potential for substantial earnings in the future
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Question 5
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Which of the following is true in regards to investing in stock?

Select one:
a.
All of the above

b.
A stock investor may or may not receive a profit

c.
A stock investor owns a part of a company

d.
A stock investor may receive a dividend
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Question 6
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A blue chip stock is associated with a company:

Select one:
a.
With a consistent record of relatively rapid growth and earnings

b.
Which dominates its respective industry and has a good company management reputation

c.
With a steady stream of income paying high dividends and retaining only a small portion of
profits

d.
With a spotty earnings pattern but potential for substantial earnings in the future
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Question 7
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A diversified portfolio is desirable because it:

Select one:
a.
Limits investors choices to only one or two investment tools
 b.
Increases the risk/return ratio

c.
Decreases risk by investing money in a variety of investment tools

d.
Indicates an investor is a good predictor of the return an investment will have
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Question 8
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The relationship between risk and return in investing can be stated as

Select one:
a.
No relationship exist between risk and return

b.
Higher risks indicates lower return

c.
Lower risk indicates higher return

d.
Higher risk indicates higher return
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Question 9
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The value of a stock can change when:

Select one:
a.
A stock split occurs

b.
All of the above

c.
A merger happens between two companies

d.
Dollar value of a stock increases or decreases
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Question 10
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Conner wants to purchase stocks with the money he received from his tax return. Who
would he contact to make the transactions?

Select one:
a.
A depository institution

b.
Any of the above

c.
A brokerage firm

d.
The New York Stock Exchange
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Question 1
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Real Estate includes land, improvement and rights.

Select one:
True
False

Question 2
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Land can be considered a fixture

Select one:
True
False

Question 3
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An estate measured by the life of a designated person is free and absolute

Select one:
True
False

Question 4
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Liquidity is an economic characteristic of land

Select one:
True
False

Question 5
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Personal property is transferred by a bill of sale

Select one:
True
False
Question 6
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Water rights do not include the right of access.

Select one:
True
False

Question 7
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The main purpose of a survey is to create or confirm a legal description

Select one:
True
False

Question 8
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A life tenant owns the property forever

Select one:
 True
False

Question 9
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Building codes differ for electric and plumbing and based on the type of property

Select one:
True
False

Question 10
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Mineral rights are rarely separated from surface rights, so they are typically conveyed to the
buyer.

Select one:
True
False

Question 1
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A corporation has no legal commitment to pay dividends until the board of directors takes
formal action to declare a dividend.

Select one:
True
False

Question 2
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The most basic requirement for a firm's marketable securities.

Select one:
a.
Marketability

b.
Bills

c.
Yield

d.
Safety
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Question 3
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Preferred shares that have the right to share in dividends above the fixed rate or amount
stated on the share certificate are known as participating preferred shares.

Select one:
True
False

Question 4
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The relationship between risk and return in investing can be stated as

Select one:
a.
Higher risks indicates lower return

b.
Lower risk indicates higher return

c.
Higher risk indicates higher return

d.
No relationship exist between risk and return
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Question 5
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Classification of bonds as to security → Straight bonds
Serial bonds
Convertible bonds
Callable or redeemable bonds
Non callable or redeemable bonds

Select one:
True
False

Question 6
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All income not paid out to creditors or preferred shareholders:

Select one:
a.
is distributed as interest to bondholders

b.
automatically belongs to common shareholders

c.
is paid out as common stock dividends

d.
is subject to a higher federal income tax rate
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Question 7
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A diversified portfolio is desirable because it:

Select one:
a.
Decreases risk by investing money in a variety of investment tools

b.
Limits investors choices to only one or two investment tools

c.
Increases the risk/return ratio

d.
Indicates an investor is a good predictor of the return an investment will have
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Question 8
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Careful analysis and focused approach are mandatory before any kind of investment.

Select one:
True
False
Question 9
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Minimum term in the Philippines of time deposits so that the depositor may roll over his
account monthly when he intends to keep his money and all its earnings in account

Select one:
a.
One month

b.
Money market

c.
Yield on bonds

d.
One year
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Question 10
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Which of the following is true in regards to investing in stock?

Select one:
a.
A stock investor owns a part of a company

b.
A stock investor may receive a dividend

c.
A stock investor may or may not receive a profit

d.
All of the above
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Question 11
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Factors to consider in investing in credit securities

Select one:
a.
Collateral trust bonds

b.
Time Deposit

c.
Date of maturity or call, Interest rates, Yield on the security, Credit rating on the issuing
party, Value of the security, Credit rating of the trustee, Credit rating of the underwriter

d.
Limitations as to withdrawals , Interest rate, Minimum balance required, Insurance and Bank
reputation
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Question 12
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Interest coupons are attached to the bond certificates and interest is paid to the holder of
said coupons → Yield on bonds

Select one:
True
False

Question 13
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A growth stock is associated with a company:

Select one:
a.
With a spotty earnings pattern but potential for substantial earnings in the future

b.
Which dominates its respective industry and has a good company management reputation

c.
With a steady stream of income paying high dividends and retaining only a small portion of
profits

d.
That is new with a consistent record of relatively rapid growth and earnings
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Question 14
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Authorized shares refer to the shares the corporation has issued.

Select one:
True
False

Question 15
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Preferred shares that have the right to be exchanged for common shares of the issuing
corporation, at the option of the preferred shareholders, are known as cumulative preferred
shares.

Select one:
True
False

Question 16
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In terms of decreasing return to the investor, the proper ranking would be:

Select one:
a.
common stock, long-term government debt, preferred stock

b.
long-term government debt, common stock, preferred stock

c.
preferred stock, common stock, secured debt

d.
common stock, secured debt, treasury bills
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Question 17
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The right of shareholders to purchase additional shares of common share issued by the
corporation is called the preemptive right.

Select one:
True
False

Question 18
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All of the following are advantages of rights offerings except:

Select one:
a.
a rights offering provides the firm with a built-in securities market
 b.
more interest may be generated in the market

c.
the dollar value of rights traded on exchanges is very high

d.
the position of current shareholders is protected
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Question 19
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Shareholders must be present at annual shareholder meetings to elect the members of the
board of directors.

Select one:
True
False

Question 20
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Which of the following investment tools is considered to be a speculative investment?

Select one:
a.
Futures
 b.
Mutual Fund

c.
Savings Bond

d.
Real Estate
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Question 21
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Financial investment refers to putting aside a fixed amount of money and expecting some
kind of gain out of it within a stipulated time frame.

Select one:
True
False

Question 22
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Type of bank account wherein deposits thereto and withdrawals there from can be made
anytime
and preferably maintained to take care of minor emergency requirements, deposits that are
small in amount and those that are intended to be withdrawn anytime during the month
Select one:
a.
Current Account

b.
Savings Account for investment purposes

c.
Savings Account

d.
Treasury Bonds
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Question 23
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In terms of increasing risk to the investor, the proper ranking would be:

Select one:
a.
long-term government debt, secured debt, preferred stock

b.
secured debt, common stock, preferred stock

c.
long-term government debt, subordinated debt, common stock

d.
common stock, preferred stock, secured debt
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Question 24
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Is a certificate of indebtedness with fixed interest rate and maturity date
- a formal and unconditional promise , made under seal , to pay a specified sum of money
at a determinable future date and to make periodic interest payments at a stated rate until
the principal amount is paid → bonds

Select one:
True
False

Question 25
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A preferred issue carrying a call provision will carry:

Select one:
a.
the same yield as non-callable preferred

b.
the same yield as callable debt

c.
a lower yield than non-callable preferred

d.
a higher yield than non-callable preferred
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