Test your basic knowledge |

Managerial Finance

Subject : business-skills
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. First time selling stock - indirectly with financial intermediary - indirectly with investment bank






2. Day to day operations - how much cash to keep on hand - how much inventory to keep on hand - will we allow to buy on credit?






3. Investors bid to buy shares - risk is on corporation

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


4. A paid individual - corporation - or commercial bank trust department that acts as the third party to a bond indenture and can take specified actions on behalf of the bondholders if the terms of the indenture are violated






5. Issued shares of common stock held by the firm; often these shares have been repurchased by the firm.






6. Agencies that assess the 'credit worthiness' of an organization. The two major rating agencies are Moody's and Standard & Poor.






7. Estimates stock value by multiplying the firm's expected earnings per share (EPS) by the average price/earnings (P/E) ratio for the industry.






8. Selling stock anytime after initial time






9. The risk that a company will be unable to pay the bond's face amount or interest payments as it becomes due.






10. Type of bonds representing property put up as collateral






11. Stock is an arbitrary value established for legal purposes in the firm's corporate charter - and can be used to find the total number of shares outstanding by dividing it into the book value of common stock.






12. Is usually applied to equity instruments such as common stock; the cost of funds obtained by selling an ownership interest.






13. Planning the long-term investments - $ coming in > $ going out






14. Is a complex and lengthy legal document stating the conditions under which a bond has been issued.






15. Allows bondholders to change each bond into a stated number of shares of common stock






16. Privately raised external equity capital used to fund early-stage firms with attractive growth prospects.






17. The percentage of a bond's par value that will be paid annually - typically in two equal semiannual payments - as interest.






18. Interest compounds four times per year.






19. A potential conflict of interest between outside shareholders (owners) and managers who make decisions about how to operate the firm.






20. Stock that gives its owners preference in the payment of dividends and an earlier claim on assets than common stockholders if the company is forced out of business and its assets sold.(not voted)






21. A bond that a corporation issues to raise money to expand its business






22. The rate that creates equilibrium between the supply of savings and the demand for investment funds in a perfect world - without inflation - where suppliers and demanders of funds have no liquidity preferences and there is no risk






23. Is a stream of equal periodic cash flows - over a specified time period. These cash flows can be inflows of returns earned on investments or outflows of funds invested to earn future returns.






24. Periodic payments of profit to the shareholders






25. Shares of common stock that have been put into circulation. - = outstanding shares + treasury stock






26. Are provisions in a bond indenture that place operating and financial constraints on the borrower






27. Money flows directly from investor to corporation - $ flows from investor to corp through an investment bank ('privileged subscription')






28. The role of the investment banker in bearing the risk of reselling - at a profit - the securities purchased from an issuing corporation at an agreed-on price.






29. When interest is credited twice a year.






30. Shares of ownership in a public corporation. The shareholder has voting rights in the corporation.






31. Is preferred stock with no stated face value but with a stated annual dollar dividend






32. Inflation - opportunity cost - risk






33. A statement transferring the votes of a stockholder to another party






34. Investment bank underwrites issuance - risk is on the investment bank






35. Money has a time value - Risk requires a reward - Cash flow is what matters - Market prices are generally correct - and Conflicts of interest create agency problems.






36. The current dollar value of a future amount - the amount of money that would have to be invested today at a given interest rate over a specified period to equal the future amount.






37. Mixture of debt and equity to finance long-term investments






38. Price of assets traded fully reflect all available information - and investors must be rational






39. The process of finding present values; the inverse of compounding interest






40. Preferred stock is preferred stock for which passed (unpaid) dividends do not accumulate.






41. A portion of a security registration statement that describes the key aspects of the issue - the issuer - and its management and financial position






42. The actual rate of interest charged by the supplier of funds and paid by the demander






43. Create wealth for the shareholders through maximizing the value of the firm by making financial decisions that will increase the price of common stock.






44. Investment bank does not underwrite - risk is on corporation

Warning: Invalid argument supplied for foreach() in /var/www/html/basicversity.com/show_quiz.php on line 183


45. Allows common stockholders to maintain their proportionate ownership in the corporation when new shares are issued - thus protecting them from dilution of their ownership.






46. Issued shares of common stock held by investors - this includes private and public investors.






47. High-risk - high-interest bonds






48. Authorized shares are the shares of common stock that a firm's corporate charter allows it to issue.






49. All else equal - the longer the time to maturity - the greater the interest rate risk to the investor






50. The value at a given future date of an amount placed on deposit today and earning interest at a specified rate. Found by applying compound interest over a specified period of time.







Sorry!:) No result found.

Can you answer 50 questions in 15 minutes?


Let me suggest you:

Browse all subjects

Browse all tests

Most popular tests



Major Subjects

Tests & Exams


AP
CLEP
DSST
GRE
SAT
GMAT

Browse all subjects

Browse all tests

Most popular tests