Business and Personal Finance © 2007

Chapter 10: Bonds and Mutual Funds

Practice Tests

1
The _______ is the dollar amount that the bondholder will receive at the bond's maturity.
A)face value
B)yield
C)premium
D)debenture
2
A bond that is not registered in the investor's name is called a _______.
A)registered bond
B)bearer bond
C)coupon bond
D)zero-coupon bond
3
A bond that is registered in the owner's name by the company that issues it is called a _______.
A)bearer bond
B)registered bond
C)serial bond
D)sinking fund
4
A _______ is a bond that an investor can trade for shares of stock.
A)mortgage bond
B)serial bond
C)convertible bond
D)sinking fund
5
To reach maturity, Treasury Bills take between _______.
A)13 to 52 weeks
B)1 to 10 years
C)6 months to 30 years
D)10 to 30 years
6
A Standard & Poor's rating of B indicates _______.
A)high risk
B)low risk
C)safe investment
D)company in default
7
The _______ is the rate of return, usually stated as a percentage, earned by an investor who holds a bond for a certain amount of time.
A)face value
B)premium
C)debenture
D)yield
8
One of the main reasons for buying a mutual fund is _______.
A)safety
B)diversification
C)guaranteed income
D)the government guarantees them
9
Only a fixed number of shares are issued for a _______.
A)closed-end fund
B)open-end fund
C)load fund
D)no-load fund
10
Payments that result from the sale of securities in a fund's portfolio are called _______.
A)income dividends
B)net asset values
C)capital gain distributions
D)shares
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