FIN 351 WEEK 1 QUIZ
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1. Question : (TCO 1) When an investor is able to convert an investment into cash in a short period of time, this is called _____.
Student Answer: liquidity
short-term orientation
low investment risk
capital appreciation
Question 2. Question : (TCO 1) A direct equity claim arises through investment in _____.
Student Answer: bonds and other debt instruments
common stocks, warrants, and options
preferred stock and commodity futures
mutual funds
Question 3. Question : (TCO 1) What factors must be considered in choosing between investment alternatives?
Student Answer: Risk and liquidity
Interest or dividends versus capital gains
Timeframe for managing funds and evaluating performance and tax effects
All of the above
Question 4. Question : (TCO 1) A means of exchanging assets, which may or may not include a specified location, and in which the seller may or may not own the assets being sold, is called _____.
Student Answer: an organized exchange
an options market
a market
None of the above
Question 5. Question : (TCO 1) In the _____ market, existing assets are exchanged between investors, while in the _____ market, participants buy their assets directly from the source of the asset.
Student Answer: primary; secondary
secondary; primary
tertiary; primary
primary; OTC
Question 6. Question : (TCO 1) Bringing private companies public for the first time is called _____.
Student Answer: a private placement
an initial public offering (IPO)
a secondary offering
a founder's sale
Question 7. Question : (TCO 1) The first exchange to become a publicly traded company was the _____.
Student Answer: New York Stock Exchange
Chicago Board of Trade
NASDAQ Stock Market
Chicago Mercantile Exchange
Question 8. Question : (TCO 1) The _____ is the tax rate that applies to each new dollar of income.
Student Answer: average tax rate
short-term capital gains tax rate
long-term capital gains tax rate
marginal tax rate
Question 9. Question : (TCO 1) Which of the following is NOT a characteristic of the Dow Jones Industrial Average?
Student Answer: It includes only very high quality common stock.
It generally follows the trend of the market.
The companies included comprise over 25% of the companies listed on the New York Stock Exchange.
It is a value-weighted average.
Question 10. Question : (TCO 1) When an investor establishes a position in a security, they are said to be _____.
Student Answer: long if they purchase the security for their account
long if they sell the security for their account
short if they sell the security for their account
Both A and C
USA 
India