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ABA CTFA Practice Test - Questions Answers, Page 13

Question list

List of questions

Question 121

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When the market's required rate of return for a particular bond is much less than its coupon rate, the bond is selling at:

Question 122

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Virgo Airlines will pay a $4 dividend next year on its common stock, which is currently selling at $100 per share. What is the market's required return on this investment if the dividend is expected

Question 123

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Interest rates and bond prices:

Question 124

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The expected rate of return on a bond if bought at its current market price and held to maturity.

Question 125

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Two people wishing to open a checking account may do so in which one of the following ways:

Question 126

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After opening the checking account, follow these basic procedures Except:

Question 127

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______________ is the result writing a check for an amount greater than the current account balance.

Question 128

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It is a booklet provided with a supply of checks, used to maintain accurate records of all checking account transactions.

Question 129

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An arrangement between the account holder and the depository institution wherein the institution automatically pays a check that overdraws the account is called:

Question 130

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Diversification__________:

Question 121

When the market's required rate of return for a particular bond is much less than its coupon rate, the bond is selling at:

A premium

A discount

cannot be determined without more information

Face value

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Virgo Airlines will pay a $4 dividend next year on its common stock, which is currently selling at $100 per share. What is the market's required return on this investment if the dividend is expected to grow at 5% forever?

4 Percent

5 Percent

7 Percent

9 Percent

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Question 123

Interest rates and bond prices:

Move in the same direction

Move in opposite directions

Sometimes move in the same direction, sometimes in opposite directions

Have no relationship with each other (i.e., they are independent)

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Question 124

The expected rate of return on a bond if bought at its current market price and held to maturity.

Yield to maturity

Current yield

Coupon Yield

Capital gains yield

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Question 125

Two people wishing to open a checking account may do so in which one of the following ways:

They can each open individual checking accounts (on which the other cannot write checks)

They can open a joint account that requires both signatures on all checks

They can open joint account that allows either one to write checks (the most common type of joint account)

All of the above

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Question 126

After opening the checking account, follow these basic procedures Except:

Always right checks in ink

Include the name of the person being paid the date, and the amount of the check

Note the check's purpose on the check

Sign the check in a different way than on the signature card

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Question 127

______________ is the result writing a check for an amount greater than the current account balance.

Overdrafts

Undercrofts

Checkbook ledger

Overdraft protection

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Question 128

It is a booklet provided with a supply of checks, used to maintain accurate records of all checking account transactions.

Overdrafts

Undercrofts

Checkbook ledger

Overdraft protection

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Question 129

An arrangement between the account holder and the depository institution wherein the institution automatically pays a check that overdraws the account is called:

Overdrafts

Undercrofts

Checkbook ledger

Overdraft protection

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