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






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






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






4. Not much risk is involved






5. 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






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






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






8. Call feature - sinking fund - serial redemption






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






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






11. 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






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






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






14. 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)






15. Initial public offerings - investment banks






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






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






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






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






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






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






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






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






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






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






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






27. 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






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






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






30. Fundamental analysis - technical analysis - efficient market theory






31. 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






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






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






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






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






36. 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






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






38. 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






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






40. A lot of risk is involved






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






42. 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






43. 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






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






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






46. Securities exchanges - over the counter market






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






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






49. 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






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







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