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






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






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






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






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






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






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






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






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






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






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






12. 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






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






14. 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






15. 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






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






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






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






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






20. 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






21. 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






22. Medium amount of risk is involved






23. 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






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






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






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






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






28. Securities exchanges - over the counter market






29. 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






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






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






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






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






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






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






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






37. Call feature - sinking fund - serial redemption






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






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






40. Not much risk is involved






41. 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






42. Fundamental analysis - technical analysis - efficient market theory






43. 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






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






45. 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






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






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






48. 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






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






50. A lot of risk is involved