Investments
Quiz Review
How Markets Work, Buying And Selling
1. Stock prices fluctuate primarily based on ________ and _________ .
2. Public companies issue quarterly reports every ___ months and annual reports
every ____ months.
3. Quarterly and Annual reports primarily provide information including __________
________________________________________________________________
4. Indicate whether each event would likely cause the stock price to rise or fall:
a. Negative news headline ____
b. New government regulation of an industry or product ____
c. Poor economic news _____
d. Insiders selling stock _____
e. Good numbers in annual report ____
f. Good Economic news ____
g. Overall market increases ____
5. If you think stock prices will rise, you are considered _____________
6. If you think stock prices will fall, you are considered _______________________
Diversification and EPS
7. Diversification means _______________________________________________
8. It is important to diversify because _____________________________________
9. What does it mean when we say companies try to “Beat the Street”? _________
________________________________________________________________
10. EPS stands for E ____________ P____________ S______________________
11. Basic EPS is calculated as follows: _________ divided by ____________
Bonds
12. Bonds are ________ that investors make to various entities
13. Three types of entities that issue bonds are _______________, _____________,
and _____________________
14. Investors can earn return on bonds through _________ paid and _________ and
_________ bonds before they are due.
15. Face Value is _____________________________________
16. Coupon is ________________________________________
17. Maturity Date is ____________________________________
18. Another name for a Federal Government bond is _____________________
19. If a bond has a face value of $1,000 and it pays 5.25% interest for 10 years, how
much total interest will the bond pay? __________________________________
20. A Callable Bond means _____________________________________________
21. A Convertible Bond means __________________________________________
Time Value of Money and Interest Rates
22. “Time Value of Money” principle states that $1 _________ is worth more than $1
_______________
23. When saving or investing, the _____________ is the initial amount of money you
deposit
24. _____________ Interest only calculates interest based on the ___________ and
not any ____________ earned.
25. ____________ Interest calculates interest based on the _____________ and any
accrued __________________
26. Which type of interest payment is preferable? ____________________________
27. Future Value is ____________________________________________________
28. The Future Value Factor is ___________________ and is comprised of
________ and number of __________ of the investment
29. If the FV Factor for an investment of 10 years at 8% is 2.1589, how much will an
investment of $500 be worth in 10 years? ____________________________
30. The Rule of 72 is used to estimate the amount of time it takes to _________ your
investment.
31. It is calculated by dividing ____________ by the annual _______________
32. Approximately how long will it take to double your money if the rate of interest is
7%? ___________________________________