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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. 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






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






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






4. Not much risk is involved






5. 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






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






7. 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






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






9. Securities exchanges - over the counter market






10. A lot of risk is involved






11. 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






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






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






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






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






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






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






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






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






20. 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






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






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






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






24. 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






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






26. Fundamental analysis - technical analysis - efficient market theory






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






28. Online research about listed companies






29. Initial public offerings - investment banks






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






31. Call feature - sinking fund - serial redemption






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






33. 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)






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






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






36. 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






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






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






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






40. 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






41. Medium amount of risk is involved






42. 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






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






44. 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






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






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






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






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






49. 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






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







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