Finance Quiz Questions

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1. Dollar-cost averaging is (Points : 3)

Periodically buying a round lot of stock periodically investing a specified dollar amount in a stock a means to increase the average cost basis a means to insure a positive return

2. The S&P 500 stock index is more sensitive to changes in the prices of small stocks than the stocks of large companies. (Points : 3)

True False

3. The S&P 500 uses (Points : 3)

A simple average A compound average A geometric average a value-weighted average

4. Which of the following is the lest broad-based measure of stock prices? (Points : 3)

Nasdaq market index Dow Jones industrial average S&P 500 stock index AMEX market value index

5. The Russell 3000 is broad-based measure of bond prices. (Points : 3)

True False

6. Indices of Nasdaq stocks tend to be less volatile than the S&P 500 index. (Points : 3)

True False

7. The Dow Jones industrial and utility averages include a relatively small number of stocks. (Points : 3)

True False

8. The basis is defined as spot minus futures. For a short hedger basis strengthens unexpectedly. Which of the following is true (Points : 3)

hedger's position improves. The hedger's position worsens. The hedger's position sometimes worsens and sometimes improves. The hedger's position stays the same.