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






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






3. Not much risk is involved






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






5. 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






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






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






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






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






10. Call feature - sinking fund - serial redemption






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






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






13. Online research about listed companies






14. Fundamental analysis - technical analysis - efficient market theory






15. 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






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






17. Securities exchanges - over the counter market






18. 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






19. 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






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






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






22. 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






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






24. A risk management technique that mixes a wide variety of invests within a portfolio






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






26. A lot of risk is involved






27. 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






28. 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






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






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






31. 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






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






33. 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






34. Initial public offerings - investment banks






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






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






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






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






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






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






41. 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)






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






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






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






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






46. 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






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






48. 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






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






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