Test your basic knowledge |

CSM Financial Management

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






2. Securities exchanges - over the counter market






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






4. 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






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






6. Diversification - affordability - professional management - liquidity - low transaction costs - no disadvantages






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






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






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






10. Fundamental analysis - technical analysis - efficient market theory






11. 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






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






13. 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






14. 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






15. The risk inherent to the entire market or entire market segment unsystematic: company or industry specific risk that is inherent in each investment






16. 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






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






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






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






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






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






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






23. Direct: primary and secondary residences - commercial property - undeveloped land - foreclosures - Indirect: real estate syndicates - limited partnerships - real estate investment trusts - mortgages - participation certificates






24. 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






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






26. 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)






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






28. Income from dividends - potential stock split - appreciation of stock value






29. 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






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






31. 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






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






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






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






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






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






37. Not much risk is involved






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






39. 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






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






41. 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






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






43. 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






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






45. Call feature - sinking fund - serial redemption






46. A lot of risk is involved






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






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






49. Balance your budget including an account for investments - pay off credit cards - start an emergency fund - have access to other cash for emergencies






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