[] FIN 400 Final Exam | Finance Final Exam Questions & Answers, Comprehensive Study Guide & Practice Test

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FIN 400/ Final Exam




- (Sub)classifications and objectives

- Use Morningstar to understand the investment style - ✔✔- ANS: Buying Mutual Funds:
Step 2 Determinants




- Agreed to in advance (worker credited percentage per year)

- Not very high (Grows at 30 year T-Bond rate) - ✔✔- ANS: Cash Balance Plan is...




- At one time with lump sum

- Rollover distributions to avoid tax - ✔✔- ANS: Annuity taxes can be paid...




- Buy direct (Phone/Internet)

- Buy through a mutual fund "supermarket" - ✔✔- ANS: Buying Mutual Funds: Step 4
Determinants




- Charge lower annual expenses but still pay trading commissions

- Are more tax-efficient than most




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- Allow investors to stake out an investment position

- Investors can make their move during the market's trading hour - ✔✔- ANS: Exchange
Traded Funds (ETFs):




- Common stock

- Bonds

- Sometimes preferred stock - ✔✔- ANS: Balanced mutual funds hold:




- Contributory

- Noncontributory - ✔✔- ANS: Characteristics of Defined-contribution plans




- Diversification

- Time dimension of risk - ✔✔- ANS: What to use when deciding what to do with
retirement funds?




- Dividend

- Capital gains

- Increase in NAV & number of shares - ✔✔- ANS: Mutual fund returns in form of:




- Goals and time horizon

- Reason for investing

- Tax deferred option




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- Risk tolerance - ✔✔- ANS: Buying Mutual Funds: Step 1 Determinants




- Government (GNMA)

- Municipal

- Corporate - ✔✔- ANS: Types of bond funds:




- Long-term growth

- Income

- Stability - ✔✔- ANS: Balanced mutual funds tries to balance objectives of:




- No loads

- Government securities

- Trade @ $1 constant NAV

- Minimal expense ratio

- Tax exemption - ✔✔- ANS: Money market mutual funds has:




- Profit-sharing Plan

- Money Purchase Plan

- Thrift & Savings Plan

- Employee Stock Ownership Plan (ESOP)

- 401K Plan - ✔✔- ANS: Types of Defined-contribution Plans




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