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






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






3. Initial public offerings - investment banks






4. A lot of risk is involved






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






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






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






8. Online research about listed companies






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






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






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






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






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






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






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






16. 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






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






18. 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






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






20. Securities exchanges - over the counter market






21. 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)






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






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






24. 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






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






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






27. Company could fail - market volatility - uncertain yield - management time required - risk






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






29. 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






30. 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






31. 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






32. Fundamental analysis - technical analysis - efficient market theory






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






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






35. Not much risk is involved






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






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






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






39. 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






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






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






42. 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






43. 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






44. Call feature - sinking fund - serial redemption






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






46. Medium amount of risk is involved






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






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






49. 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






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