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CSM Financial Management

  • Answer 50 questions in 15 minutes.
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  • 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. Not much risk is involved

2. 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

3. Interest rate risk - face value volatility - no hedge against inflation - principal does not appreciate - difficult to compound

4. The uncertainty over the future real value (after inflation) of your investment

5. An equity security that pays regular often steadily increases dividends and offers a high yield that may generate the majority of overall returns

6. 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

7. Debenture bond - mortage bond - subordinated debenture bond - convertible bond - high yield bond

8. Securities exchanges - over the counter market

9. The process of selecting investments with a higher risk in order to profit from an anticipated price movement

10. Pay yourself and make investing automatic - save extra funds like gifts - partcipate in your employeers retirement plan - make installment payments to yourself - break a habit - get a part-time job

11. Stocks Day trading - margin buying - selling short - option trading

12. A debt security issued by a government spending most often issued in the country's domestic currency

13. 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

14. By make a risky investment you can be returned with a lot of money or losing some

15. Evaluate potential investments - seek assistance if needed - monitor the value of investments - keep accurate and current records - consider tax consequences of selling

16. 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

17. Online research about listed companies

18. Written promise to pay with legal conditions (indenture) - face value - maturity date - interest rate=coupon rate - trustee

19. A short term debt obligation backed by the U.S. government with a maternity of less than one year

20. Corporate earnings - earnings per share - price earnings rato (PE) - dividend payout - dividend yield - total return - beta - market to book ratio

21. A portfolio management strategy and model for investing in fixed income that involves purchasing multiple bonds - each with different maturity dates

22. Shares in a company whose earnings are expected to grow at an above average rate relative to the market

23. Stocks buy& hold - dollar cost averaging - direct investment and DRIPS

24. Investing stock in a company and having the risk that it will shut down

25. Illiquidity - declining property values - lack of diversification - long depreciation period - management problems - syndicate investment is not a tax shelter

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

27. Asset allocation funds - balanced funds - value funds - money market funds - life cycle funds - funds of funds

28. A debt security issued by a corporation and sold to investors - higher risk higher risk and government bond

29. A nationally recognized - well-established and financially sound company

30. 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

31. Investing in something that could have a risk of a world wide issue

32. 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

33. Initial public offerings - investment banks

34. A stock that rises quickly when economic growth is strong and falls rapidly when growth is slowing down

35. 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

36. Call feature - sinking fund - serial redemption

37. An investment strategy that aims to balance risk and reward by apportioning a portfolio's assets according to an individual's goal

38. A stock that provides a constant dividend and stable earnings regardless of the state of the overall stock market

39. Cash dividends - price appearance - hedge against inflation - low minimum investment - limited liability - liquidity

40. 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)

41. A lot of risk is involved

42. 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

43. Primary residence: you hold legal title - place to live - mortage interest is tax deductible - usually an inflation hedge - beware of housing bubbles

44. A market that exists between companies and financial institutions that is used to raise equity capital for the companies

45. The risk that an investments value will change due to the change due to the change in the absolute level of interest rates

46. A risk management technique that mixes a wide variety of invests within a portfolio

47. A marketable U.S. government debt security with a fixed interest rate and a maturity between one and 10 years

48. Medium amount of risk is involved

49. A marketable fixed interest U.S. government debt security with a maturity of more than 10 years

50. An order placed with a brokerage to buy or sell a set number of shares at a specific price or better