Welcome to your Jargon Buster Quiz. This is a formative learning exercise to ensure you have the foundations to complete JT+ Good luck and do your best! Feel free to use your Jargon Buster Handbook to help you answer the questions. Name Email 1. Risk in financial markets refers to: Guaranteed loss Dividend reduction only Market closure The possibility of financial loss or variability of returns None 2. The Competition and Markets Authority (CMA) is responsible for: Setting interest rates Enforcing UK competition law and reviewing mergers Regulating derivatives Issuing government bonds None 3. An open ended investment fund that expands and contracts with investor demand is Closed Ended Fund OEIC Preference Share Investment Trust None 4. Protectionism refers to: Increasing dividends Encouraging free trade Reducing interest rates Restricting international trade None 5. A rights issue requires shareholders to: Sell shares Pay to subscribe for new shares Redeem bonds Receive free shares None 6. The primary market is concerned with: Collecting taxes Issuing new securities Clearing derivatives Trading existing shares None 7. The FTSE All Share Index represents approximately: 98 percent of UK listed shares by value Only technology companies Top 100 shares only Top 250 shares only None 8. Private Markets primarily involve investments that are: Not traded on public stock exchanges Limited to property Guaranteed by governments Traded daily on stock exchanges None 9. The difference between nominal value and market price is that nominal value: Equals dividend Fluctuates daily Is face value repaid at maturity Includes accrued interest None 10. Credit risk refers to: Interest rate changes Borrower failing to repay Liquidity shortage Market volatility None 11. Inflation reduces the real value of: Equity volatility Cash holdings Interest rates Market capitalisation None 12. The spread in financial markets refers to: Coupon difference Difference between bid and offer price Dividend growth Yield to maturity None 13. A Green Bond is primarily issued to finance: Defence spending Executive bonuses Environmentally beneficial projects Share buybacks None 14. Under SMCR, senior managers must: Set government policy Guarantee profits Accept personal responsibility for their areas Avoid regulation None 15. An open economy is one that: Controls all production Trades freely with other countries Has fixed interest rates Restricts imports None 16. The annual compound return from holding a bond to maturity is called: Gross Redemption Yield Dividend Yield Coupon Rate Face Value None 17. Artificial Intelligence (AI) is increasingly used in financial services to: Analyse large amounts of data and identify patterns Replace all human investment managers Guarantee investment returns Print physical banknotes None 18. An ISA provides: Government pension Tax efficient wrapper for investments Guaranteed return Corporate bond insurance None 19. A company unable to pay debts as they fall due is: Diversified Illiquid Insolvent Leveraged None 20. A company issues free shares to existing shareholders and the share price adjusts proportionately. What is this called? Share Buyback Bonus Issue Capital Reduction Rights Issue None 21. A market correction is best described as: Permanent decline Short term price reversal Company insolvency Dividend suspension None 22. An instrument issued at a discount and redeemed at par without paying coupons is: Floating Rate Note Preference Share Zero Coupon Bond Convertible Bond None 23. A nominal share value refers to: Current market price Total assets Face value stated in company constitution Dividend amount None 24. NAV is particularly important for pricing: Investment trusts only Corporate bonds OEICs and unit trusts Derivatives None 25. Diversification primarily aims to: Maximise tax Reduce risk Increase volatility Increase leverage None 26. A smart contract is: A type of insurance policy A government regulation A legal contract signed by a lawyer A blockchain based contract that can execute automatically None 27. A company gains control of another company when it acquires more than what percentage of voting shares? 50 percent of shares 25 percent of shares 100 percent of shares 75 percent of shares None 28. The balance sheet shows: Dividend history Assets, liabilities and equity Share price movements Company profits only None 29. A merger involves: Two companies combining into one entity Liquidating assets One company buying majority shares Issuing new bonds None 30. Fiscal policy refers to: Interest rate decisions Taxation and government spending Bond yields IPO pricing None 31. Stamp Duty Land Tax applies primarily to: Share purchases Dividend payments Bond redemptions Property purchases None 32. Monetary policy primarily involves: Company regulation Interest rate setting Tax increases Government spending None 33. An incentive often associated with investing in a VCT is: Fixed dividends Zero risk Tax relief Guaranteed capital None 34. Active management attempts to: Eliminate risk Outperform a benchmark Avoid research Mirror an index exactly None 35. Market capitalisation is calculated by: Total company debt Dividend multiplied by earnings Assets minus liabilities Share price multiplied by shares in issue None 36. An Initial Public Offering is: A new issue of shares A bond redemption A rights issue A secondary market trade None 37. A collective investment scheme organised as a fixed size company with shares traded on an exchange is: OEIC Investment Trust Unit Trust Tracker Fund None 38. A market maker is obliged to: Pay dividends Provide two way prices Set interest rates Issue bonds None 39. An investor expecting falling market prices is described as: Bear Bull Leveraged Long None 40. Leverage measures: GDP expansion Dividend growth Debt relative to equity Liquidity depth None 1 out of 1 Thanks for completing the quiz. You will receive your result soon.
