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Essentials of Investments, 12th Edition Test Bank
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Essentials of Investments, 12th Edition Test Bank
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Version 1 1 CHAPTER 1 1) Financial assets represent _______ of total assets of U.S. households in 2019. A) about 70% B) over 90% C) under 10% D) about 30% 2) Real assets in the economy include all but which one of the following? A) Land B) Buildings C) Consumer durables D) Common stock 3) In 2019, net worth represented _______ of the liabilities and net worth of commercial banks. A) about 51% B) about 91% C) about 11% D) about 31% 4) According to the Flow of Funds Accounts of the United States, the largest single asset of U.S. households is _______. Version 1 2 A) mutual fund shares B) real estate C) pension reserves D) corporate equity 5) According to the Flow of Funds Accounts of the United States, the largest liability of U.S. households is _______. A) mortgages B) consumer credit C) bank loans D) gambling debts 6) _______ is not a derivative security. A) A share of common stock B) A call option C) A futures contract D) A put option 7) According to the Flow of Funds Accounts of the United States, the largest financial asset of U.S. households is ________. A) mutual fund shares B) corporate equity C) pension reserves D) deposits Version 1 3 8) Active trading in markets and competition among securities analysts helps ensure that: 1. Security prices approach informational efficiency. 2. Riskier securities are priced to offer higher potential returns. 3. Investors are unlikely to be able to consistently find under- or overvalued securities. A) 1 only B) 1 and 2 only C) 2 and 3 only D) 1, 2, and 3 9) The material wealth of society is determined by the economy's _______, which is a function of the economy's _______. A) investment bankers; financial assets B) investment bankers; real assets C) productive capacity; financial assets D) productive capacity; real assets 10) Which of the following is not a money market security? A) U.S. Treasury bill B) 6-month maturity certificate of deposit C) common stock D) mortgage backed security 11) _______ assets generate net income to the economy, and _______ assets define allocation of income among investors.The benefits of buying summaries with Stuvia:
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