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Finance & Investment Quiz
Finance & Investment · Easy
20 questions · Unlimited attempts · Free online practice
Money affects almost every part of our lives, from buying a home and starting a business to saving for retirement or planning a vacation. Understanding finance and investment helps...
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All 20 questions in this Finance & Investment quiz
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What is 'Variable Cost'?
- A. Cost that doesn't change
- B. Cost that changes with output
- C. Salary
- D. Rent
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A financial ratio that explicitly shows how much a company pays out in dividends each year relative to its current stock price is the:
- A. Dividend yield
- B. Earnings per share
- C. Payout ratio
- D. Return on equity
-
How is a company's market capitalization (market cap) calculated?
- A. By subtracting its total liabilities from its total assets
- B. By multiplying its annual revenue by its profit margin
- C. By multiplying its current share price by its total number of outstanding shares
- D. By dividing its net income by the number of outstanding shares
-
What is 'Net Profit'?
- A. Opening balance
- B. Total sales
- C. Total revenue
- D. Revenue minus all expenses
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What is 'Bear Market'?
- A. No trade
- B. Rising prices
- C. Falling prices
- D. Stable prices
-
What is compound interest?
- A. Interest calculated only on the initial principal
- B. Interest calculated on the initial principal and all accumulated interest
- C. A fixed fee charged for borrowing money
- D. The rate central banks charge commercial banks
-
What is 'Credit'?
- A. Paying now
- B. A fine
- C. Ability to obtain goods before payment
- D. Cash only
-
The highly illegal practice of buying or selling a public company's stock based on material information that is not yet available to the general public is called:
- A. Front running
- B. Wash trading
- C. Insider trading
- D. Market manipulation
-
What is an Exchange-Traded Fund (ETF)?
- A. A basket of securities that trades on an exchange just like an individual stock
- B. A government bond specifically designed to protect against inflation
- C. A type of savings account that locks money in for a set period
- D. A private equity fund available only to accredited investors
-
What does the acronym IPO stand for in the stock market?
- A. Initial Public Offering
- B. Internal Portfolio Optimization
- C. International Pricing Option
- D. Index Performance Output
-
What is a 'Bear Market' characterized by?
- A. Rising prices
- B. Stable prices
- C. Falling prices
- D. No trading
-
What does the Price-to-Earnings (P/E) ratio tell an investor?
- A. The total absolute dividend payout of a stock
- B. The ratio of a company's debt to its total equity
- C. The absolute liquidation value of a company's physical assets
- D. How much the market is willing to pay today for a stock based on its past or future earnings
-
In finance, how quickly and easily an asset can be converted into ready cash without heavily affecting its market price is formally known as its:
- A. Volatility
- B. Solvency
- C. Elasticity
- D. Liquidity
-
What is 'Mortgage'?
- A. Savings account
- B. A tax
- C. Credit card
- D. Loan for property
-
What is 'Profit'?
- A. A tax
- B. Financial gain
- C. Money lost
- D. Total revenue
-
What is 'Stock Market'?
- A. Place where shares of companies are traded
- B. A farmers market
- C. Place to buy groceries
- D. A bank
-
What is 'Fixed Cost'?
- A. Cost that changes with output
- B. Price of a product
- C. Cost of labor
- D. Cost that remains constant regardless of output
-
What is an investment vehicle that pools money from many investors to purchase a diversified portfolio of stocks and bonds?
- A. A real estate investment trust (REIT)
- B. A certificate of deposit (CD)
- C. A mutual fund
- D. A collateralized debt obligation (CDO)
-
What is 'Revenue'?
- A. Tax
- B. Expenses
- C. Total profit
- D. Total money received from sales
-
The fundamental risk management strategy of mixing a wide variety of investments within a portfolio to completely minimize exposure to any single asset is known as:
- A. Hedging
- B. Arbitrage
- C. Leveraging
- D. Diversification