IFIC EXAM STUDY GUIDE
Current account - answers -records exhanges of goods between canada and forgeiners
Roe ratio - answers -profit/equity
Eps - answers -profit/number of common shares outstanding
Dividend yield - answers -annual dividend / stock price
P/e ratio - answers -ratio of stock price to earnings per share
Measuring performance - answers -ending navps-beggining navps x100/beggining
navps
Purchase price - answers -navps/100%-sales charge
Inflation - answers -cpi current period- cpi previous period/cpi previous period x 100
Return % - answers -cash flow + ending value - beginning value/begginign value x 100
Current ratio - answers -current assets - current liabilities
Interest ratio coverage - answers -earning before interest and taxes/total interest
charges
Gross profit margin ratio - answers -gross profit/sales
Current yield on bonds - answers -annual cash show/ current market price x100
Direct investment - answers -couple investing savings in a home, government building
a new highway
Indirect investment - answers -purchase of representational items such as stocks or
mutual funds
Capitals three characteristics - answers -it is mobile, sensitive to its environment, it is
scarce
Retail investors - answers -individual investors who buy and sell securities for their own
personal accounts, and not for another company or organization.
, Institutional investors - answers -large organizations - such as pension funds, mutual
funds, and insurance companies - that invest their own funds or the funds of others
Derivaties - answers -products based on or derived from an underlying security
Secondary market - answers -investments that have already been issued by
companies or governments
Auction market - answers -buyers enter bids and sellers enter offers for a stock
Dealer markets - answers -network of dealers who trade with each other. Often called
otc markers
Factors in gdp growth - answers -increase in population, increase in capital,
improvement in technology.
Phases of the business cycel - answers -expansion, peak, trough, recovery.
Output gap - answers -the difference between actual output and potential output
Demand-pull inflation - answers -increases in the price level (inflation) resulting from an
excess of demand over output at the existing price level, caused by an increase in
aggregate demand
Cost-push inflation - answers -when prices rise due to an increase in the cost of
production.
Phillips curve - answers -states that when unemployment is low, inflation tends to be
high. When unemployment is high, inflation tends to be low.
Sacrifice ratio - answers -the number of percentage points of annual output lost in the
process of reducing inflation by 1 percentage point
Drawdown - answers -transfer from boc accounts at chartered banks back to boc
Re-deposit - answers -transfer from boc back to accounts at chartered banks
Capital/financial account - answers -records financial flows between canada and us in
the investment realm.
Defined benefit plan - answers -benefits are pre-determined based on a formula.
Including years of service, income level and other variables.
Defined contribution plan - answers -contributions to the plan are pre-determined and
benefits at retirement, will depend on how contributions were invested
Current account - answers -records exhanges of goods between canada and forgeiners
Roe ratio - answers -profit/equity
Eps - answers -profit/number of common shares outstanding
Dividend yield - answers -annual dividend / stock price
P/e ratio - answers -ratio of stock price to earnings per share
Measuring performance - answers -ending navps-beggining navps x100/beggining
navps
Purchase price - answers -navps/100%-sales charge
Inflation - answers -cpi current period- cpi previous period/cpi previous period x 100
Return % - answers -cash flow + ending value - beginning value/begginign value x 100
Current ratio - answers -current assets - current liabilities
Interest ratio coverage - answers -earning before interest and taxes/total interest
charges
Gross profit margin ratio - answers -gross profit/sales
Current yield on bonds - answers -annual cash show/ current market price x100
Direct investment - answers -couple investing savings in a home, government building
a new highway
Indirect investment - answers -purchase of representational items such as stocks or
mutual funds
Capitals three characteristics - answers -it is mobile, sensitive to its environment, it is
scarce
Retail investors - answers -individual investors who buy and sell securities for their own
personal accounts, and not for another company or organization.
, Institutional investors - answers -large organizations - such as pension funds, mutual
funds, and insurance companies - that invest their own funds or the funds of others
Derivaties - answers -products based on or derived from an underlying security
Secondary market - answers -investments that have already been issued by
companies or governments
Auction market - answers -buyers enter bids and sellers enter offers for a stock
Dealer markets - answers -network of dealers who trade with each other. Often called
otc markers
Factors in gdp growth - answers -increase in population, increase in capital,
improvement in technology.
Phases of the business cycel - answers -expansion, peak, trough, recovery.
Output gap - answers -the difference between actual output and potential output
Demand-pull inflation - answers -increases in the price level (inflation) resulting from an
excess of demand over output at the existing price level, caused by an increase in
aggregate demand
Cost-push inflation - answers -when prices rise due to an increase in the cost of
production.
Phillips curve - answers -states that when unemployment is low, inflation tends to be
high. When unemployment is high, inflation tends to be low.
Sacrifice ratio - answers -the number of percentage points of annual output lost in the
process of reducing inflation by 1 percentage point
Drawdown - answers -transfer from boc accounts at chartered banks back to boc
Re-deposit - answers -transfer from boc back to accounts at chartered banks
Capital/financial account - answers -records financial flows between canada and us in
the investment realm.
Defined benefit plan - answers -benefits are pre-determined based on a formula.
Including years of service, income level and other variables.
Defined contribution plan - answers -contributions to the plan are pre-determined and
benefits at retirement, will depend on how contributions were invested