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CFA Level2 Vocab

Subjects : certifications, cfa
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 statistical measure that indicates the peakedness of a distribution.






2. Regression that models the straight-line relationship between the dependent and independen t variable (s) .






3. The expansion of production pos-sibilities that results from capital accumulation and technological change.






4. A bar chart of data that have been grouped into a frequency distribution.






5. The pursuit of wealth by capturing economic rent---consumer surplus - producer sur-plus - or economic profit.






6. An option that gives the holder the right to sellan underlying asset to another party at a fixedprice over a specific period of time.






7. The amount the company estimates that it can sell the asset for at the end of its useful life.






8. A rule explaining the expected value of a random vari-able in terms of expected values of the random variable conditional on mutually exclusive and exhaustive scenarios.






9. The after-tax net operating profits as a percent of total assets or capital.






10. A calculation of yield that is annualized using the ratio of 365 to the number of days to maturity. Bond equivalent yield allows for the restatement and comparison of securities with different compounding periods.






11. Asset allocation in which the invest-ment in the market is increased if one forecasts that the market will outperform T-bills.






12. The value of the U.S. dollar in terms of other currencies in the foreign exchange market.






13. A sample measure of the degree of a distribution's peakedness.






14. A payment system in which cus-tomer payments are mailed to a post office box and the banking institution retrieves and deposits these payments several times a day - enabling the company to hav use of the fund sooner than in a centralized system in wh






15. A present value model of stock value that views the intrinsic value of a stock as present value of the stock's expected future dividends.






16. Very liquid short-tenn investments - usually maturing in 90 days or less.






17. The expected return in excess of the risk-free rate for a portfolio with a sensitivity of 1 to one factor and a sensitivity of 0 to all other factors.






18. The ratio of cash dividends paid to earnings for a period.






19. Said of a por tfolio for which eco-nomic sectors are represented in the same pro-portions as in the benchmark - using market-value weights.






20. A diagram with branches emanating from nodes representing either mutually exclu-sive chance events or mutually exclusive decisions.






21. An attempt to acquire a com-pany against the wishes of the target's managers.






22. Aka Harmonic mean.






23. A wholly-owned sub-sidiary of a company that is established to provide financing of the sales of the parent company.






24. An activity ratio equal to rev-enue divided by average receivables.






25. Amount that must be set aside each period to have $1 at some future point in time.






26. Method of managing inventory that minimizes in-process inventory stocks. kth order autocorrelation The correlation between observations in a time series separated by k periods.






27. The error of not rejecting a false null hypothesis.






28. A transformation that involves sub-tracting the mean and dividing the result by the standard deviation.






29. The volatility that option traders use to price an option - implied by the price of the option and a particulau option-pricing model.






30. ID) With respect to random variables - the property of ran-dom variables that are independent of each otherbut follow the identical probability distribution.






31. Interest earned but not yet paid.






32. A value against which a computed test statistic is compared to decide whether to reject or not reject the null hypothesis.






33. The amount of income earned during a period per share of common stock.






34. A complete pass through the steps of a simula tion .






35. The value derived using a sum-of-the-parts valuation.






36. Ratios that measure the quantity of an asset or flow (e.g. - earnings) in relation to the price associated with a specified claim (e.g. - a share or ownership of the enterprise).






37. The possibility that when we use a time-series sample - our statistical conclusion may be sensitive to the starting and ending dates of the sample.






38. The share price at a particular point in the future.






39. Financial statements that are not accompanied by an auditor's opinion letter.

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40. A measure of central tendency computed by taking the nth root of the product of n non-negative values.






41. The period benefited~y the employee's service - usually th e period between the grant date and the vesting date.






42. ROA) A prof-itability ratio calculated as operating income divided by average total assets.






43. A quantitative measure that specifies where data are centered.






44. Attempts by management to encourage analysts to forecast a slightly lower number for expected earnings than the analysts would otherwise forecast.






45. An agreement between two parties in which one party - the buyer - agrees to buy from the other party - the seller - an underlying asset at a later date for a price established at the start of the contract.






46. Individual accounts to which an employee and typically the employer makes contributions - generally on a tax-advantaged basis. The amounts of contributions are defined at the outset - but the future value of the benefit is unknown. The employee bears






47. Valuation approach that values an asset based on pricing multiples from sales of assets viewed as similar to the subject asset.






48. Amounts owed to the company from parties other than customers.






49. An extra return that compensates investors for the increased sensitivity of the mar-ket value of debt to a change in market interest rates as maturity is extended.






50. The science of describing - analyzing - and drawing conclusions from data; also - a collection of numerical data.