MENU
If federal excise taxes were increased by the government, what would the typical investor do about his securities portfolio?
Suggested Answer: D
Get Premium Series-7 Questions
as Interactive Web-Based Practice Test or PDF
Real Exam Format
Detailed Explanations
Instant Access
Get Your Practice Test
take no action as a result of the tax increase. Excise taxes normally are not important to the typical investor. They generally have little relative effect on securities prices.
3 comments · newest first
WI
Wilda
5 days ago
I practiced a question similar to this, and I feel like D could be a possibility if investors think the tax increase won't affect their strategy much.
KA
Kattie
10 days ago
I'm not sure about this one, but I remember something about corporate bonds being more sensitive to tax changes. Maybe B is the right choice?
MA
Marleen
15 days ago
I think if federal excise taxes go up, investors might look for tax-exempt options, so A could make sense.