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Test your basic knowledge |
CSM Financial Management
Start Test
Study First
Subjects
:
certifications
,
csm
,
business-skills
Instructions:
Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Income from dividends - potential stock split - appreciation of stock value
Diversification
Advantages of mutual funds
Primary markets
Why investors purchase common stock
2. Fundamental analysis - technical analysis - efficient market theory
Equity capital
Your role in the investment process
Investment theories
Income stock
3. Written promise to pay with legal conditions (indenture) - face value - maturity date - interest rate=coupon rate - trustee
Advantages of bonds
Characteristics of corporate bonds
Investment theories
Asset allocation
4. 1. What will you use money for 2. how much will you need 3. how long will it take 4. are there obstacles 5. will you make sacrifices 6. what if you don't reach the goal
Investment Goals
Why corp issue common stock
Provisions for repayment
Aggressive risk
5. Debenture bond - mortage bond - subordinated debenture bond - convertible bond - high yield bond
Disadvantages of stocks
Bond funds
Market risk systematic
Types of bonds
6. A marketable fixed interest U.S. government debt security with a maturity of more than 10 years
Treasury bonds
Investment Goals
Income stock
Classification of real estate investments
7. Possible hedge against inflation - easy purchase on indirect ownership - limited financial responsibility for indirect ownership - financial leverage - positive cash flow - no management concerns on indirect ownership
Advantages of real estate
Characteristics of corporate bonds
Iinvestors choose precious metals
Cyclical stock
8. The risk that an investments value will change due to the change due to the change in the absolute level of interest rates
Disadvantage of real estate
Interest rate risk
Advantages of mutual funds
Stop order
9. Investing stock in a company and having the risk that it will shut down
Investment Goals
Treasury notes
Advantages of mutual funds
Business failure risk
10. A stock that rises quickly when economic growth is strong and falls rapidly when growth is slowing down
Why investors purchase mutual funds
Asset allocation
Stop order
Cyclical stock
11. An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks and bonds
Mutual fund
Cumulative stock
Numerical measures for stocks
Conservative risk
12. Stocks buy& hold - dollar cost averaging - direct investment and DRIPS
Long term techniques
Moderate risk
Numerical measures for stocks
Characteristics of a mutual fund
13. An equity security that pays regular often steadily increases dividends and offers a high yield that may generate the majority of overall returns
Stop order
Income stock
Treasury bills
Moderate risk
14. Illiquidity - declining property values - lack of diversification - long depreciation period - management problems - syndicate investment is not a tax shelter
Blue chip
Speculative investment
Financial check up
Disadvantage of real estate
15. To raise money for start up - on going activities or expansion - no repayment required - dividends are not mandatory - they lose some control of the company through voting rights
Why corp issue common stock
Convertible preferred stock
Investment Goals
Types of bonds
16. Cash dividends - price appearance - hedge against inflation - low minimum investment - limited liability - liquidity
Long term techniques
Advantages of stocks
Risk return trade-off
Defensive stock
17. Corporate earnings - earnings per share - price earnings rato (PE) - dividend payout - dividend yield - total return - beta - market to book ratio
Advantages of real estate
Numerical measures for stocks
Types of bonds
Aggressive risk
18. Medium amount of risk is involved
Disadvantage of real estate
Cyclical stock
Asset allocation
Moderate risk
19. Initial public offerings - investment banks
Primary markets
Why corp issue common stock
Aggressive risk
Liquidity
20. A debt security issued by a corporation and sold to investors - higher risk higher risk and government bond
Corporate bond
Defensive stock
Why investors purchase corporate bonds
Features of real estate
21. A type of preferred stock with a provision that stipulates that if any dividends have been omitted in the past they must be paid out to preferred stockholders before common shareholders can receive dividends
Cumulative stock
Inflation risk
Treasury notes
Disadvantage of real estate
22. Company could fail - market volatility - uncertain yield - management time required - risk
Cumulative stock
Convertible preferred stock
Disadvantages of stocks
Treasury notes
23. Direct: primary and secondary residences - commercial property - undeveloped land - foreclosures - Indirect: real estate syndicates - limited partnerships - real estate investment trusts - mortgages - participation certificates
Features of real estate
Stock funds
Classification of real estate investments
Obtaining money to inves
24. Close ended funds (2%): shares are traded limited and must purchase from another investor -exchange trade funds (6%): tied to a specfic index - open end funds (92%): shares issued and redeemed by the company at net asset value (NAV)
Characteristics of a mutual fund
Why investors purchase corporate bonds
Provisions for repayment
Types of bonds
25. Call feature - sinking fund - serial redemption
Short term techniques
Bond laddering
Advantages of bonds
Provisions for repayment
26. High interest rate than savings account - safe return of principles - less volatile than stocks - regular income - diversification of portfolio - low purchase price - ease of management - municipal bonds are tax free
Types of bonds
Advantages of bonds
Diversification
Speculative investment
27. Balance your budget including an account for investments - pay off credit cards - start an emergency fund - have access to other cash for emergencies
Convertible preferred stock
Disadvantages of bonds
Financial check up
Why corp issue common stock
28. The risk inherent to the entire market or entire market segment unsystematic: company or industry specific risk that is inherent in each investment
Market risk systematic
Growth stock
Financial check up
Moderate risk
29. The process of selecting investments with a higher risk in order to profit from an anticipated price movement
Speculative investment
Types of bonds
Obtaining money to inves
Other funds
30. Securities exchanges - over the counter market
Treasury bonds
Secondary markets
Asset allocation
Short term techniques
31. The uncertainty over the future real value (after inflation) of your investment
Inflation risk
Market risk systematic
Advantages of mutual funds
Why corp issue common stock
32. A lot of risk is involved
Global investment risk
Aggressive risk
Advantages of bonds
Why investors purchase common stock
33. Interest income: -paid semiannually on most bonds registered bonds - bearer bonds - zero coupon bonds - dollar appreciation of bond value - bond repayment at maturity: -bond laddering
Long term techniques
Liquidity
Why investors purchase corporate bonds
Treasury bonds
34. Aggressive growth funds - equity income funds - global stock funds - growth stock funds - index funds - international funds - large cap funds - mid cap funds - small cap funds - regional funds - sector funds - socially responsible funds
Short term techniques
Treasury bonds
Cyclical stock
Stock funds
35. A market that exists between companies and financial institutions that is used to raise equity capital for the companies
Why investors purchase corporate bonds
Corporate bond
Market risk systematic
Equity capital
36. A short term debt obligation backed by the U.S. government with a maternity of less than one year
Investment theories
Treasury bills
Moderate risk
Mutual fund
37. Hedge against inflation - safe haven during political or economic upheavals - need a storage place - can be risky-not easy to turn to cash - difficult to appraise
Iinvestors choose precious metals
Google Fimamce
Interest rate risk
Other funds
38. Not much risk is involved
Conservative risk
Mutual fund
Stock funds
Disadvantages of stocks
39. A portfolio management strategy and model for investing in fixed income that involves purchasing multiple bonds - each with different maturity dates
Your role in the investment process
Advantages of bonds
Bond laddering
Asset allocation
40. Diversification - affordability - professional management - liquidity - low transaction costs - no disadvantages
Liquidity
Stop order
Advantages of mutual funds
Cumulative stock
41. An order that an investor makes through a broker or brokerage service to buy or sell an investment immediately at the best available current price
Diversification
Market order
Types of bonds
Conservative risk
42. Investing in something that could have a risk of a world wide issue
Risk return trade-off
Convertible preferred stock
Cyclical stock
Global investment risk
43. An order to buy or sell a security when it's price surpasses a certain point
Stop order
Risk return trade-off
Advantages of mutual funds
Corporate bond
44. A nationally recognized - well-established and financially sound company
Features of real estate
Market order
Investment Goals
Blue chip
45. Evaluate potential investments - seek assistance if needed - monitor the value of investments - keep accurate and current records - consider tax consequences of selling
Iinvestors choose precious metals
Your role in the investment process
Other funds
Why corp issue common stock
46. High yield funds ( junk bonds) - long term corporate - long term U.S. - intermediate corporate - intermediate U.S. - short term corporate - short term U.S. - municipal bonds - world bond funds
Types of bonds
Why investors purchase common stock
Bond funds
Characteristics of a mutual fund
47. An order placed with a brokerage to buy or sell a set number of shares at a specific price or better
Diversification
Limit order
Secondary markets
Growth stock
48. Combines funds of investors and invests those monies in a diversified portfolio of securities issued by corporations or governments that meet the fund objective
Why investors purchase mutual funds
Numerical measures for stocks
Mutual fund
Defensive stock
49. Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares after a predetermined date
Treasury bonds
Stock funds
Diversification
Convertible preferred stock
50. A marketable U.S. government debt security with a fixed interest rate and a maturity between one and 10 years
Treasury notes
Advantages of bonds
Treasury bonds
Global investment risk