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MultipleChoiceQuiz

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MultipleChoiceQuiz
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ResultsReporter
Outof15questions,youanswered4correctlywithafinalgradeof27%
4correct(27%)
11incorrect(73%)
0unanswered(0%)

YourResults:
Thecorrectanswerforeachquestionisindicatedbya

1
INCORRECT

Financialmarketsareusedfortrading:
A) bothrealassetsandfinancialassets.
B) thegoodsandservicesproducedbyafirm.
C) securities,suchassharesofBCE.
D) therawmaterialsusedinmanufacturing.
Feedback:Seepage31

2
INCORRECT

Theterm"capitalstructure"refersto:
A) thechoicebetweenequityanddebtfinancing
B) thelengthoftimeneededtorepaydebt.
C) whetherthefirminvestsincapitalbudgetingprojects.
D) whichspecificassetsthefirmshouldinvestin.
Feedback:Seepage32

3CORRECT

Theprimarydistinctionbetweensecuritiessoldintheprimaryandsecondarymarketsisthe:
A) riskinessofthesecurities.
B) priceofthesecurities.
C) previousissuanceofthesecurities.
D) profitablityoftheissuingcorporation.
Feedback:Seepages3132

4
INCORRECT

Themoneymarketisa(an)______market,whilethecapitalmarketisa(an)______market.
A) investmentliquidity
B) shorttermlongterm
C) liquidityfinancialinstitution
D) longtermshortterm
Feedback:Seepage33

5
INCORRECT

Theminimum,acceptablerateofreturnoncorporateinvestmentsisdeterminedby:
A) investorsinfinancialmarkets.
B) informationfromaccountingstatements.
C) thefinancialmanager.
D) theseniormanagersofthecompany.
Feedback:Seepages4142

6
INCORRECT

Allbutoneofthefollowingisaserviceprovidedtocorporationsbyfinancialmarketsand
intermediaries?
A) paymentsservices
B) contractstomanagerisk
C) liquidity
D) realinvestments
Feedback:Seepage39

7
INCORRECT

Whilecorporationsprovideshareholdersreturnsfrom_______,capitalmarketsprovidereturns
toshareholdersfrom______?
A) capitalgainsdividends
B) appreciationcapitalgains
C) dividendscapitalgains

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MultipleChoiceQuiz

C) dividendscapitalgains

D) earningscapitalappreciation
Feedback:Seepages3031

8CORRECT

Ownersofmutualfundsown______andarecalled_______?
A) depositsdepositors
B) bondsbondholders
C) sharesshareholders
D) IOU'sofmutualfundscreditors
Feedback:Seepages3334

9
INCORRECT

Thefirsttimeasecurityissolditisinthe_______marketsubsequenttradingofthesecurityis
inthe______market.
A) moneycapital
B) capitalmoney
C) bankingsecondary
D) primarysecondary
Feedback:Seepages3132

10
INCORRECT

Commonstockofcorporationsmaybelistedonstockexchangesortraded:
A) overthecounter.
B) bybrokerswhoownaninventoryofsharesfromwhichtheybuy/sell.
C) betweendirectorsofthecorporation.
D) betweeninsidersofcompanies.
Feedback:Seepage32

11
INCORRECT

Allbutoneofthefollowingisknownasafinancialmarket?
A) foreignexchangemarket
B) pensionfundmarket
C) moneymarket
D) fixedincomemarket
Feedback:Seepage33

12
CORRECT

Financialmarketsevaluatetheperformanceofpubliclytradedcorporations
A) constantly.
B) quarterlywhenfinancialstatementsarefiledwiththeOSC.
C) annually,whentheannualreportisissued.
D) asrequestedbythemanagersofthecorporations.
Feedback:Seepage41

13
INCORRECT

Asnewinformationisavailable,financialmarkets
A) reflectthisnewinformationimmediatelyinthepricesofsecuritiestraded.
B) publishthisinformation.
C) providetheinformationtofinancialintermediaries.
D) decidehowbesttotellthepublic.
Feedback:Seepage41

14
INCORRECT

WhenshareholderAsellsitsNortelstocktoshareholderBinthesecondarymarket,suchason
theTorontoStockExchange,howmuchmoneyisreceivedbyNortel?
A) Nortelwillreceivemostofthefunds,exceptforcommissions.
B) Nortelwillreceivenothing.
C) Nortelwillreceiveonlythecommissionsonthesaleofstock.
D) Nortelwillreceiveaportionofthefundsforeverystocktradedonthesecondarymarket.
Feedback:Seepage32

15
CORRECT

Themostimportantserviceprovidedbymutualfundstomutualfundinvestorsis:
A) theopportunitytobuycorporatesecuritiesatadiscountedprice.
B) highexpensesandtradingcostswhichincreasetherateofreturnforinvestors.
C) diversification.
D) ahigherthanaveragerateofreturn.
Feedback:Seepage34

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