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5 Written questions

5 Matching questions

  1. annuity
  2. large-cap fund
  3. growth stock mutual fund
  4. dividend
  5. risk return ratio
  1. a fund that buys stock in medium-sized companies that have experienced some growth and are still expanding; also called a mid-cap fund.
  2. b relationship of substantial reward in comparison to the amount of risk taken.
  3. c contract sold by an insurance company, designed to provide payments to the holder at specified intervals, usually after retirement; the holder is taxed at the time of distribution or withdrawal, making this a tax-deferred arrangement.
  4. d funds comprised of large, well-established companies.
  5. e distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders; generally distributed in the form of cash or stock.

5 Multiple choice questions

  1. piece of ownership in a company or mutual fund.
  2. mutual fund that seeks to maintain a stable share price and to earn current income by investing in interest-bearing instruments with short-term (usually 90 days or less) maturities.
  3. Securities that represent part ownership or equity in a corporation, wherein each share is a claim on its proportionate stake in the corporation's assets and profits, some of which may be paid out as dividends.
  4. degree of uncertainty of return on an asset; in business, the likelihood of loss or reduced profit.
  5. to spread around one's investment dollars among several different classes of financial assets and among the securities of many issuers; results in lowered risk.

5 True/False questions

  1. futurespiece of ownership in a company or mutual fund.


  2. liquidityquality of an asset that permits it to be converted quickly into cash without loss of value; availability of money; when there is more liquidity, there is typically less return.


  3. small-cap fundmutual fund that invests in companies whose market value is less than $1 billion; largely consists of smaller, more volatile companies; also called aggressive growth stock mutual fund.


  4. aggressive growth stock mutual fundmutual fund that seeks to provide max. long-term capital growth from stocks of primarily smaller companies or narrow market segments; dividend income is incidental; the most volatile fund; also referred to as a small-cap fund.


  5. commoditya food, metal, or fixed physical substance that investors buy or sell, usually via future contracts.