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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. Under U.S. GAAP - a measure used in estimating a defined-benefit pen-sion plan's liabilities - defined as 'the actuarial present value of benefits (whether vested or non-vested) attributed by the pension benefit formula to employee service rendered b






2. An attempt to take control of a company through a shareholder vote.






3. A bias caused by using information that was not available on the test date.






4. An option contract that can be exercised at any time until its expiration date.






5. A probability drawing on per-sonal or subjective judgment.






6. Standard errors of the esti-mated parameters of a regression that correct for the presence of heteroskedastici ty in the regres-sion's error te






7. Uncorrelated; at a right angle.






8. With reference to the cash flow statement - a format for the presentation of the statement in which cash flow from operat-ing activities is shown as operating cash receipts less operating cash disburseme ts.






9. A stage of growth in which a company typically enjoys rapidly expanding markets - high profit margins - and an abnormally high growth rate in earnings per share.






10. The currency in which finan-cial statement amounts are presented.






11. Investments in which the investor has no signifi-cant influence or control over the operations of the investee.






12. An option strategy that involves buying a call with a lower exercise price and selling a call with a higher exercise price. It can also be exe-cuted with puts.






13. Futures contracts in which the underlying is a traditional agricultural - metal - or petroleum product.






14. The process of allocating the cost of intangible long-term assets having a finite useful life to accounting periods; the allocation of the amount of a bond premium or discount to the periods remaining until bond maturity.






15. A swap in which the underlying is an interest rate. Can be viewed as a currency swap in which both currencies are the same and can be created as a combination of currency swaps.






16. A merger involving companies at different positions of the same production chain; for example - a supplier or a distributor.






17. Ratios that measure a company's ability to generate profitable sales from its resources (assets).






18. A money measure of the mini-mum value of losses expected during a specified time period at a given level of probability.






19. In reference to short-term cash man-agement - an investment strategy characterized by monitoring and attempting to capitalize on mar-ket conditions to optimize the risk and return relationship of short-term investments.






20. The official price - designated by the clearinghouse - from which daily gains and losses will be determined and marked to market.






21. The standard deviation of the differ-ences between a portfolio's returns and its bench-mark's returns; a synonym of active risk.






22. A probability distribution that specifies the probabilities for a group of related random variables.






23. A tactic used by acquirers to circumvent target management's objections to a proposed merger by submitting the proposal directly to the target company's board of directors.






24. The hypothesis to be tested.






25. A tool that calculates the contri-bution to real CDP growth of each of its sources.






26. An agreement between two governments in which the government of the exporting country agrees to restrain the volume of its own exports.






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






28. A public offer whereby the acquirer invites target shareholders to submit ('tender') their shares in return for the proposed payment.






29. The normal density with mean equal to 0 and standard deviation (0') equal to l.






30. A two-dimensional plot of pairs of obser-vations on two data series.






31. In the fixed income markets - to price a security on the basis of valuation-relevant char-acteristics (e.g. - debt-rating approach).






32. 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.






33. A theory of economic growth based on the idea that real CDP per person grows because of the choices that people make in the pursuit of profit and that growth can persist indefinitely.






34. CAPM An adaptation of the CAPM that adds to the CAPM a premium for small size and company-specific risk.






35. The dollar amount of cash divi-dends paid during a period per share of common stock.






36. When parties agree to exchange only the net amount owed from one party to the other.






37. Members ips in a derivatives exchange.






38. The actual amount paid for income taxes in the period; not a provision - but the actual cash outflow.






39. The graph of the capital asset pricing model.






40. A form ofcommon-size analysis in which the accounts in agiven period are used as the benchmark or baseperiod - and every account is restated in subse-quent periods as a percentage of the base period'ssame account.






41. Segment profit (loss) divided by segment revenue.






42. Debt with the added feature that the bondholder has the option to exchange the debt for equity at prespecified terms.






43. Assets that are expected to provide economic benefits over a future period of time - typically greater than one year.






44. The prooability of an observation - given a par ticular set of conditions.






45. Method used to estimate the overall capitalization rate by dividing the sale price of a comparable income property into the net operating income.






46. With reference to assets - the amount of cash or cash equivalents that could currently be obtained by sell ing the asset i an orderly disposal; with reference to lia-bilities - the undiscounted amount of cash or cash equivalents expected to be paid t






47. Valuation indicators that relate either price or a fundamental (such as earnings) to the time series of their own past val-ues (or in some cases to their expected value).






48. The risk that a company will suffer an extended diminution in market value relative to other companies in the same industry due to a demonstrated lack of concern for environmental - social - and governance risk factors.






49. Tax expenses that have been recognized and recorded on a company's income statement but which have not yet been paid.






50. An unlimited funds environment assumes that the company can raise the funds it wants for all profitable projects simply by paying the required rate of return.