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Exam 19: Using Securities Markets for Financing and Investing Opportunities

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Question 21

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An income stock offers investors a relatively high dividend yield on their investment.

A) True
B) False

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Question 22

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A penny stock generally sells for a low initial price,pays regular dividends and provides consistent growth in the stock's value.

A) True
B) False

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Question 23

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Well-known foreign exchanges that also exchange the securities of U.S.firms include the London Exchange and the Tokyo Exchange.

The owner of a convertible bond can exchange the bond for a specified number of shares of common stock in the same corporation.

The Securities and Exchange Commission developed ________ to halt trading in the stock market for a short time when the market has experienced a dramatic decrease in prices.

The risk/return tradeoff investors assume means:

Greg purchased 2000 shares of common stock of the Rite Track Corporation last year.He learned several months later that the stock does not pay a dividend.Greg should proceed to:

When Tong Su purchased 500 shares of preferred stock in the Vibrates Corporation,his certificate indicated the stock had a par value of $50 per share.This means that Tong Su:

As creditors of a firm,bondholders enjoy voting privileges for the firm's board of directors' elections.

Many observers suggest that the stock market is dominated by the buying and selling activities of institutional investors.

Although you were not fortunate enough to get Chipper's Golf Resort stock [ticker symbol: CHPR] as an IPO,you are still thinking about trying to add some to your portfolio.Last week when you mentioned it to your broker,he said that there are plenty of shares trading on ___________,but,he wanted to send you the company's financial disclosures provided in the ______ before you finalize your decision.

Which of the following securities provides the owner the right to vote for the corporate board of directors?

When an investor sells a security for more than the purchase price,the investor earns a(n) :

A sinking fund provision decreases the risk of repayment in the minds of the investors.

Although companies that issue bonds are required to pay interest,companies issuing stock are not required to pay dividends.

The stock of companies that fail to meet a stock exchange's minimum requirements can be delisted.

Applying what you have learned about investments introduced to you in Chapter 19,put the following investments in order from riskiest to least risky.Which of following lists begin with the least risky investment and ends with the most risky? Least risky = 1;most risky = 5

Most businesses prefer to meet their long-term financial needs through:

A round lot refers to the purchase of 100 shares of stock in the same company in a single transaction.

Corporations issuing ________ bonds pledge a tangible asset as collateral to reduce the risk incurred by a bondholder.