FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 5: Financial Services: Mutual Funds and Hedge Funds

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

Multiple Choice

Review LaterAdd Note

Review Later

5-110 What is the NAV of both funds?

A) $30.33 and $13.50.
B) $60.00 and $27.00.
C) $30.00 and $54.00.
D) $60.00 and $27.00
E) $15.00 and $54.00.

F) B) and E)
G) B) and C)

Correct Answer

verified

Show Answer

Question 22

True/False

Review LaterAdd Note

Review Later

5-1 Mutual funds are financial intermediaries that invest in diversified portfolios of assets.

A) True
B) False

Correct Answer

verified

Show Answer

Question 23

True/False

Review LaterAdd Note

5-23 Class B shares of a mutual fund are typically charged a back-end load when the shares are redeemed.

5-113 If the price of P&G shares rises to $35 and the price of Microsoft falls to $40.00,what is the new NAV of both funds? Assume Eveningstar has 1,000 shares outstanding,and 300 shares of Intel?

5-43 U.S.mutual fund companies have made significant progress in entering Japan and Europe.

5-61 A mutual fund has the following share characteristics: Shares are offered at the NAV with no front-end load,a 12b-1 fee of 1 percent is charged,a back-end load of 1 percent is charged only if the shares are sold by the investor within one year of purchase,and the shares do not convert to any other class of shares.These shares would be classified as

5-27 Historical evidence indicates that the benefits of greater management attention in load funds do not outweigh the disadvantages of the load fee.

5-51 The returns obtained by investors of mutual funds include the following except

5-111 To what level should the price of Microsoft shares decline in order for the NAV of Morningstar fund to remain constant if the price of P&G rises to $40?

5-102 Allows the SEC to introduce circuit breakers to halt trading on exchanges.

5-92 Which of the following hedge fund objectives would be classified under the "moderate risk" category?

5-33 The Investment Advisors Act of 1940 sets out rules to prevent conflicts of interest,fraud,and excessive fees or charges for mutual fund shares.

5-7 Equity mutual funds may contain common stock,but not preferred stock.

5-67 The type of abusive activity that involves arrangements between mutual fund companies and brokerage houses is

5-4 Commercial banks are not allowed to own or invest in mutual funds.

5-39 Mutual funds are required to hire chief compliance officers whose job is to monitor whether the mutual fund company follows exchange and regulatory rules.

5-14 The SEC requires that prospectuses or advertisements regarding a mutual fund contain information that returns of the mutual fund carry some risk.

5-85 An investor purchases fund shares with a 3 percent front-end load and expects to hold the shares for 10 years.The fund has a total fund expense ratio (including 12b-1 fees) of 1 percent per year.The annual total shareholder cost for this fund is _______ per year.

5-40 The chief compliance officer of a mutual fund reports directly to the senior executives of the fund management company.

5-35 Directed brokerage is a trading abuse where a mutual fund and a brokerage agree to promote sales of certain funds in exchange for orders of specific stocks and bonds.