University of Pittsburgh

Katz Investing IQ Quiz

Welcome to the Katz Investing IQ Quiz.

Once you buy a company's bond...
  • A. You are a lender of the company
  • B. You can lose more than your original investment
  • C. You are personally responsible for the company's debt in case of default
  • D. You are the owner of the company
When interest rates go up, bond prices generally...
  • A. Go down
  • B. Go up
  • C. Are unaffected
  • D. Depend on whether the bond is trading above or below par value
Which type of bond is the safest?
  • A. Corporate bond
  • B. Municipal bond
  • C. U.S. Treasury bond
  • D. Junk bond
Once you buy a company's common stock...
  • A. You are an owner of the company
  • B. You are a lender of the company
  • C. You are personally responsible for the company's debt in case of default
  • D. You can lose more than your original investment
Chad is given the choice of either receiving a lump sum payment of $900,000 today or $1,000,000 in ten years. Which option should Chad choose?
  • A. Take the $900,000 today
  • B. Take the $1,000,000 in ten years
  • C. It depends on the interest rates
  • D. The two options are equivalent
All of the below are asset classes except...
  • A. Stocks
  • B. Bonds
  • C. Mutual Funds
  • D. Money Market Securities
In general, investments with higher risk tend to provide _____ returns over time versus investments with lower risk.
  • A. Smaller
  • B. Larger
  • C. Equal
  • D. Depends on the amount invested
In trying to diversify his investment portfolio, Jeff is correct in doing each of the following except...
  • A. Avoid putting all of his retirement funds in his employer's stock
  • B. Investing in both domestic and international funds
  • C. Buying some low priced and some high priced stocks
  • D. Spreading his investments across stocks and bonds
Over the next 20 years in the U.S., the highest average returns will probably be generated by:
  • A. Stocks
  • B. Bonds
  • C. CDs
  • D. Money Market Accounts
Which of the following organizations insures you against losses in the stock market?
  • A. FDIC (Federal Deposit Insurance Corporation)
  • B. SEC (Securities and Exchange Commission)
  • C. SIPC (Securities Investor Protection Corporation)
  • D. None of the above