Question 1: The Capitalist Mutual Fund's portfolio is valued at $48 million. The fund has liabilities of $4 million, and the investment company sponsoring the fund has issued 1,600,000 shares. What is the fund's net asset value?

• $48.00
• $30.00
• $36.66
• $27.50
• $1

Question 2: A(n) _____ mutual fund is one in which investors pay a commission every time they purchase shares.

• closed-end
• open-end
• no-load
• load
• convertible

Question 3: Mary Cooper just purchased 200 shares in the All-American Fidelity Fund. The purchase cost for each share was $40. If this fund charges a 5% load, what is the total amount of commission she will pay the investment company?

• $10
• $200
• $40
• $400
• It is impossible to calculate Ms. Cooper's total investment with this information.

Question 4: A(n) _____ fund is a mutual fund that invests in stocks issued by companies with a long history of paying dividends.

• balanced
• equity income
• industry
• sector
• money market

Question 5: A mutual fund that invests in the common stocks of companies in the same industry is called a(n) _____ fund.

• growth-income
• income
• sector
• small-cap
• money market

Question 6: According to federal law, an REIT must meet all of the following requirements except

• I it must distribute 90% or more of its taxable annual earnings to shareholders.
• it must hire independent real estate professionals to perform certain management activities.
• it must have at least 100 shareholders, with no more than half of all shares owned by five or fewer people.
• it must directly invest in apartment houses, shopping malls, and other commercial property.

Question 7: Single-family houses are typically expected to observe the following pattern.

• Values tend to rise, providing a possible hedge against inflation.
• Values rise less than the Consumer Price Index.
• Values remain stable in the northern parts of the United States.
• Values tend to rise in New England states, but decline in the South.
• Values remain unchanged in the United States.

Question 8: The real property investment most widely favored by the small investor besides the purchase of a home is

• a Post Office building.
• land.
• a building with 20 apartments.
• a condominium.
• a duplex, fourplex, or small apartment building.

Question 9: An investment in _____ is an example of an indirect real estate investment.

• a single-family home
• a duplex
• an apartment building
• land
• a REIT

Question 10: Owen Cartwright has joined a real estate syndicate that purchased a commercial office building in downtown Seattle, WA. What type of investment does he hold?

• Direct investment in real estate
• Investment in gems
• Investment in precious metals
• Investment in collectibles
• Indirect investment in real estate

Question 11: All of the following are misconceptions about retirement planning except for which?

• My expenses will drop when I retire.
• My retirement will last only 8 years.
• I can depend on Social Security income and Medicare for medical bill payment.
• I can depend on my company pension.
• My savings will still be affected by inflation.

Question 12: The average life expectancy of a woman at age 65 is

• 9 years.
• 16 years.
• 13 years.
• 11 years.
• 19 years.

Question 13: Which statement is regarding retirement living expenses?

• It is impossible to estimate your spending needs.
• Your spending patterns will probably not change.
• You'll use a smaller amount of money for food, housing, and medical care.
• The exact amount of money you'll need is impossible to predict.
• Work-related expenses, such as driving back and forth to work, tend to be lower during retirement.

Question 14: The of division of pensions in a divorce situation primarily depends on the _____.

• length of the divorce period
• husband's generosity
• length of the marriage
• judge's decision

Question 15: When you retire, which one of the following expenditures is likely to decrease?

• Medical expenses
• Insurance expenses
• Clothing expenses
• Expenses for leisure activities
• Gifts and contributions

Question 16: Estate planning involves _____ if a person is married.

• the interest of at least two people
• fewer legal requirements
• fewer financial responsibilities
• seeking the services of a securities broker
• None of the above

Question 17: A person or institution who holds or generally manages property for the benefit of someone else under a trust agreement is called a(n)

• beneficiary.
• executor.
• trustee.
• guardian.
• executrix.

Question 18: If you do not have a valid will when you die, the IRS confiscates your property.

• the federal court decides how the property should be distributed.
• your relatives or friends will get the property.
• your local custom will determine how the property is distributed.
• the state's law of descent and distribution becomes your will.

Question 19: Estate planning opportunities and problems for many people were created by which of the following laws?

• Tax Reform Act of 1986
• Internal Revenue Code of 1954
• Impoundment Control Act of 1974
• Emergency Deficit Control Act of 1985
• Economic Recovery Tax Act of 1981

Question 20: Under a(n) _____, everything will pass to your spouse when you die, with the exception of an amount equal to the exemption, which passes into trust.

• simple will
• traditional marital share will
• exception will
• stated dollar amount will
• exemption trust will