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






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






3. 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






4. 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






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






6. The degree to which an asset or security can be bought or sold in the market without affecting the asset's price






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






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






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






10. Fundamental analysis - technical analysis - efficient market theory






11. An order to buy or sell a security when it's price surpasses a certain point






12. Online research about listed companies






13. Securities exchanges - over the counter market






14. 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






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






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






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






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






19. Combines funds of investors and invests those monies in a diversified portfolio of securities issued by corporations or governments that meet the fund objective






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






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






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






23. 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






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






25. Medium amount of risk is involved






26. Call feature - sinking fund - serial redemption






27. 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






28. 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






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






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






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






32. Not much risk is involved






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






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






35. A lot of risk is involved






36. 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






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






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






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






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






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






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






44. 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






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






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






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






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






49. 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






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