2014 Investment Outlook Seminar Quiz
Photo by Reuben Neese
Click here for the answers – AFTER you take the quiz.
View our recording of the seminar by clicking here.
1) Which, if any, of the following is true?
- The U.S. economy has never been bigger.
- Corporate profits have never been higher.
- Private payrolls have never been greater.
- Bank lending has never been more generous.
2) Bob showed the chart below on the velocity of money supply, which is a measure of how fast money circulates. What the chart suggests is:
- The Federal Reserve is low on the money it makes available to banks.
- Banks aren’t lending money as fast as normal.
- Banks can’t find borrowers to lend to.
- Consumers are spending too much.
3) True or False: The increase in the strength of the dollar could mean that the Federal Reserve has to raise interest rates sooner.
4) What does the table below suggest about stock valuations?
- Stocks are a better value now than they were a year ago.
- It’s time to get out of the market.
- Stocks are fairly valued.
- Stocks are too expensive to buy anymore.
5) Bond prices move in the opposite direction of interest rates in proportion to the bond’s duration. Which of these formulas best illustrates that?
- (Change in Interest Rate) X (Duration) = Change in Price
- Earnings ÷ Price = Earnings Yield
- Price ÷ Earnings = P/E ratio
6) True or False: Using quantitative easing, the Federal Reserve has succeeded at keeping inflation where it wants.
7) Which of the following is not an issue that Bob listed among his concerns at the moment?
- U.S. housing market
- Global economic growth
- International relations
8) True or False: The slow pace of the economic recovery (which began in 2009) is a sure sign that we are overdue for another recession.
9) Name the two fundamental determinants of whether stock prices go up or down over the long run.
10) Which, if any, of the following does Bob cite as causing eight of the last 10 recessions?
- Spikes in oil prices
- Government deficits
- Interest rate hikes by the Fed
- Tax increases
(initially posted Oct. 7, 2014)