With Regard to the Past Price Performance of Closed-End Mutual

question 14

Multiple Choice

With regard to the past price performance of closed-end mutual funds

• A)most funds have traded at both a premium and a discount to NAV.
• B)most funds trade on a stock exchange just like a publicly traded corporation.
• C)suggests the risk-return characteristics can be quite different from those of the securities underlying the fund.
• D)all of the options

Understand the concept and process of assignment of contractual rights.

Comprehend the negotiation process of a negotiable instrument.

Compare the advantages and disadvantages of the assignment of contractual rights and the negotiation of negotiable instruments.

Understand the implications and risks involved in the endorsement of a negotiable instrument.

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Definitions:

Opportunity Cost

The cost of foregoing the next best alternative when making a decision.

Foregone Interest

The potential interest income lost by choosing an alternative investment or spending decision instead of the present option that yields interest.

FDIC Insurance

A federal guarantee of safety for depositor funds in member banks, up to a defined limit.

Bank Panics

Situations in which a large number of bank customers attempt to withdraw their deposits simultaneously due to fears that the bank will become insolvent.