Timberland Investment Funds - DOC

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					Chapter Thirteen Test Bank

                                     Chapter Thirteen

                                  The Role of Real Assets

B      1. Classical characteristics of land include all of the following EXCEPT
             a. it is immobile
             b. it is fungible
             c. it is indestructible
             d. it is non-income producing

B      2. Which of the following is a financial asset?
            a. Gold bar
            b. Stock certificate
            c. Automobile
            d. Office building

D      3. Which of the following is a real asset?
            a. Corporate bond
            b. Government bond
            c. Twenty dollar bill
            d. Computer

D      4. ______ property is a legal interest in real estate.
             a. Personal
             b. Proprietary
             c. Financial
             d. Real

A      5. Which of the following is a characteristic of a financial asset?
            a. It has a corresponding liability
            b. It produces income
            c. It usually shows price appreciation
            d. It usually generates no income

D      6. The majority of institutional landowners are looking for
             a. annual cash flows
             b. long-term price appreciation
             c. short-term price appreciation
             d. a mix of annual cash flows and long-term price appreciation

                                                             Chapter Thirteen Test Bank

B   7. Of their investments in real estate, pension funds have about ____ of their
    money in timberland.
         a. 2%
         b. 4%
         c. 8%
         d. 12%

A   8. Usual motivations for timberland investment include all of the following
         a. regulatory defense
         b. collateral
         c. pure investment
         d. strategic investment

A   9. State governments with large investments in timberland are
           a. California and New Hampshire
           b. Missouri and Maine
           c. Alabama and Texas
           d. Pennsylvania and New Jersey

B   10. Growing trees are called
          a. land stands
          b. stumpage
          c. wood on the hoof
          d. volume land

C   11. Conditions that make a section of land different than the surrounding terrain
    are called
            a. biological factors
            b. fungibility factors
            c. microsite factors
            d. acquisition factors

D   12. A trained forest appraiser knows to look for forests undergoing
          a. a species shift
          b. a micro site shift
          c. mutual canopy support
          d. a product class shift

Chapter Thirteen Test Bank

A      13. Timberland losses due to fire, insects, and disease total less than _____ per
             a. 0.2%
             b. 2%
             c. 5%
             d. 10%

B      14. Clear-cutting may be appropriate if a forest depends on
             a. river drainage
             b. mutual canopy support
             c. wetland waterfowl
             d. animal grazing

A      15. A significant inhibition to timberland investment has histo rically been
             a. the lack of a standard timberland index
             b. adverse Internal Revenue Service rulings
             c. high commission costs
             d. inability to generate income

A      16. One study indicates that the correlation coefficient between timberland and
       the S&P500 index is about
             a. -.50
             b. 0
             c. .50
             d. .95

C      17. A common motivation for the purchase of gold is
             a. income generation
             b. tax advantages
             c. the security it provides
             d. a substitute for equity securities

D      18. The price of gold is fixed daily in
             a. Budapest
             b. Washington, D. C.
             c. Amsterdam
             d. London

A      19. The largest percentage of privately held gold is in
             a. France
             b. United States
             c. India
             d. Saudi Arabia

                                                               Chapter Thirteen Test Bank

C   20. Which of the following is generally not a driving force behind gold price
         a. Inflation
         b. The strength of foreign currencies
         c. Supply
         d. Demand

A   21. The primary advantage of gold certificates is
          a. convenience
          b. tax reasons
          c. added income producing ability
          d. added security against corporate default

D   22. For a U. S. coin in circulation, which of the following is usually highest?
           a. Numismatic value
           b. Intrinsic value
           c. Popular value
           d. Fiat value

C   23. Which of the following is not an official gold coin issued by a government?
          a. South African Krugerrand
          b. Canadian Maple Leaf
          c. Congolese Harmonica
          d. Chinese Panda

B   24. Land is widely considered to be a
          a. mobile investment
          b. long-term investment
          c. fungible investment
          d. financial asset

B   25. Which of the following is not a way to invest in gold?
         a. Bullion
         b. Gold ADRs
         c. Gold certificates
         d. Shares in gold mining companies


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