Chapter 11 Questions A B C D

Transcription

1 Chapter 11 Questions A B C D Which of these is NOT a part of the financial system? governments to control the market organizations that bring funds and assets together the funds that a saver transfer to a borrower financial assets that certify conditions of the loan Financial institutions that help investors such as Finance companies, Life Insurance companies and Banks are known as? asset management financial intermediaries diversified companies financial assets The financial system transfers funds from savers to.. the government companies who own the stock people that want to borrow money banks Which is considered the highest "risk"? Treasury bonds -grade bonds preferred stock junk bonds One of the important side-effects of putting money in a pension fund is to.. save for big purchases like a house to provide for children and other dependents reduce your current tax bill create a college fund Which is considered the highest "risk"? Treasury bonds common stock preferred stock speculative stock a life insurance company a finance company a stock certificate a credit union The S&P 500 is a.. listing of profitable bonds a list of the 500 most profitable stocks on the NYSE index of stock performance a rating of government and municipal bonds Contracts to buy or sell at a later time using a price determined today are known as.. futures trading speculation bonds ratings margin trading Sallie Krawcheck rose to become the chief financial officer for what corporation? Exxon Corporation Forbes Magazine Bank of America Citigroup Inc. A dollar invested when you are born at 9 percent interest will be worth how much when you turn eighty? over one-thousand almost one-million about five-hundred over five-thousand The market where existing securities can be sold to new buyers is known as.. Which of these is NOT one of the three parts of the financial system? the market borrowers willing to pay to use the funds the futures market the primary market the secondary market government regulation of markets excess funds that to make investing can be lent safe organizations to bring lenders and borrowers together The "rule of 72" gives a rough idea on.. the amount of money needed to retire at age 72 what percentage of your income you should be saving the interest rate paid by differently rated bonds how long an takes to double your money Which is considered the highest "risk"? Treasury bonds common stock preferred stock prime commercial paper

2 A fund set up to provide retirement income for a worker is known as a.. pension portfolio surety premium corporations savings and loan associations credit unions pension funds Which of these represent a "nonbank financial institutions"? all of these pension funds life insurance companies finance companies Investors who want to be involved in the stock market usually invest in.. s money market bonds junk bonds government securities s financial systems home owner's insurance pension funds The price a consumer pays to a Life Insurance company for death benefits is known as a. mortgage surety pension funds premium Compound interest means the bank.. pays interest directly to the saver interest is locked in a cannot be changed increase over time pays interest on previously earned interest amounts When money is borrowed for a year or more, the transaction is part of the money market capital market futures market options market The Dow-Jones average involves only the bond market is based on the performance of 30 representative stocks is based on the performance of all stocks advertises good stock s local governments credit unions pension funds banks An advantage gained by the purchase of municipal bonds is that they pay the highest generally are taxexempt usually come due in three months are high-risk s Sallie Krawcheck reached what important accomplishment according to Forbes Magazine? President of the New York Stock President of the Secretary of State for the President top ten as the world's most powerful women Which of these is NOT a characteristic of junk bonds government insured they are lower rated high interest yields high risk Junk bonds are usually issued by.. corporation in the used car business corporations with poor credit ratings corporations just getting started foreign corporations beginning business in the U.S. What is the main reason for buying Junk Bonds? the safety of the they are easy to resell later they are great longterm high on the When people save money.. they help convert debts to currency they are not contributing to economic growth they make funds available to others to borrow they slow the economic growth of the country

3 To raise additional cash corporations can issue.. pension credits Treasury Bills shares of stock bonds Which of these would be an accurate statement(s) about bonds? they entitle the holder to a share of ownership in a corporation they are usually a low-risk they are generally held for 3 to 6 months they are insured by the FDIC The interest rate the bond issuer pays to the bond holder is called the value rate discount rate maturity rate coupon rate Which of the following in NOT a basic component of bonds? coupon rate par value liquidity maturity The term for how long a bond will pay interest before the initial is repaid is called the.. financial age coupon rate maturity loan return Why will many bonds sell for less than their par value? possible risks of the the government sets a price ceiling they pay no interest they are for very short terms An investor with a diversified portfolio has.. a seat on the stock exchange holdings in several different companies holdings in one corporation limits placed on trading If the issuing corporation promises to pay 6 percent interest each year on a bond that is the.. bond price par value return rate coupon rate The face value or principal value of a bond is also often called its maturity par value liquidity coupon value A life insurance company is an example of a.. money market s tax-exempt institution nonbank financial institution A triple A rating for a bond means is issued by the government the bond pays the highest possible interest the bond has just been issued the bond is considered a very safe A bond rating of "D" usually means the bond is about to be paid off the bond has the best rating the bond is insured by the FDIC the bond is in default Which of these organizations does NOT generally issue bonds to raise money? cities securities and exchange commission corporations the government Payments made on an insurance policy are called.. options coupons premiums dividends To finance the building of a new police station, a local government is most likely to issue. Treasury bonds municipal bonds money market bonds junk bonds Which of these is NOT a reason people invest in certificates of deposit? they can be resold to other investors they pay higher interest than savings accounts they can be for short term they are insured by the FDIC

4 A retiree may receive a regular company allowance called a.. premium pension return rate Which of these is NOT a reason people invest in municipal bonds? they usually pay the highest possible they are a long term income from them is tax-exempt they are considered very safe s To finance the building of a new police station, a local government is most likely to issue a junk bond money market bond municipal bond treasury bond Savings bonds differ from most other bonds in that they provide a higher rate of return they are issued in only large denominate the buyer does not receive interest payments during the life of the bond they are for very short terms What are the two types of savings bonds? taxable and taxexempt one-hundred dollar and five-hundred dollar five year and ten year paper and paperless Which type of government has the shortest maturity? Treasury bonds Federal Bank Notes Treasury Bills Savings Bonds What is the main difference between Treasury notes and Treasury bonds? how the Treasury Department calculates interest their par value how long it takes to mature who can buy them United States government obligations with maturities of two to ten years are known as... Treasury Notes Notes Treasury Bills certificates of deposit United States government obligations with maturities of more than 10 years are known as.. Treasury Bonds Notes Treasury Bills certificates of deposit Which type of government does not pay interest? Treasury bonds Treasury Bills Mutual Funds Savings Bonds Because Treasury notes and Treasury bonds are considered very safe they they are only sold in very small numbers they are very restrictive about how can purchase them pay the highest pay a very low interest rate The most popular and widely publicized measure of stock market performance on the New York Stock is the.. S&P 500 DJIA OTC NASDAQ An example of equity is a long term certificate of deposit a treasury bill a share of stock a treasury bond The best feature of saving in a IRA is the the account can be sold like any other the government will also put money in the account the money can be used for many other s taxes are not paid until after retirement Municipal bonds are considered a safe because they.. are high risk have extensive collateral to back them are backed by the government's power to tax have the highest A long-term tax-sheltered account that an employee can set up to draw on in the future is called a.. Individual Retirement Account Treasury Bond savings bonds money market

5 The difference between capital markets and money markets is the size of the the amount of interest promised on the if the is private or public money the period of the A market in which money is loaned for periods of less than one year is known as a.. money market secondary market capital market primary market Which of the following is NOT an example of a liquid asset? a checking account a certificate of deposit a debit card cash If a financial asset can be resold it is part of the market exchange market secondary market primary market If a financial asset cannot be resold it is part of the market exchange market secondary market primary market United States Treasury bonds.. have the highest return can be redeemed to gold or silver at anytime are considered to be the safest of all financial assets have a maturity date of two to ten years The difference between primary markets and secondary markets is based on.. how long the asset must be held to mature can the asset be resold how large the company is if it is traded on the NYSE The Buttonwood Agreement created.. the New York Stock the first the first stock exchange the European Stock In 2006 the New York Stock merged with.. the American Stock Euronext the Chicago Stock Financial institutions are required to provide investors with information about possible s in a document known as a.. disclosure agreement risk evaluation prospectus portfolios The collection of different s and financial assets held by an individual or business is known as its.. portfolios prospectus dividends The profit earned on s are known as.. liquidity endowments windfall profits returns What company was listed on the Dow Jones 30 when the book was published but is no longer on the list? Boeing Coca-Cola American Internation Group DuPont What is the fastest growing part of the American financial markets? life insurance s pension funds saving accounts What is the fastest growing part of the American financial markets? saving accounts s life insurance pension funds What company was listed on the Dow Jones 30 when the book was published but is no longer on the list? ExxonMobile Corporation Ford Citigroup Inc. General Electric

6 The money donated by investors in a 401(k) plan goes into one or more mutual funds stock in the company Savings bonds Treasury bonds The Internet has allowed discount brokerage firms to eliminate what type of job.. When you invest in a, managers stock exchanges you are guaranteed your money is a fixed return on your invested in a variety of stocks and bonds exchange traders you will have easier access to your money than in a savings account stockbrokers your money is invested in a variety of insurance policies The market value of a share of a is known as.. NAV EMH NDP GDP What company was listed on the Dow Jones 30 when the book was published but is no longer on the list? General Electric Boeing General Motors McDonalds The idea that all stocks are usually priced close to their actual value on stock exchanges is known as.. NYSE EMH NAV GDP Investments known as 401(k)'s are intended to help people avoid pay higher save save for retirement taxes than necessary for college expenses save to buy a home The largest exchange of stocks and commodities in the U.S. is the.. OTC Market Chicago Board of New York Stock The Dow Jones Industrial Average consists of 500 different stocks that change annually 60 stocks selected from the NVSE, the NASDAQ and OTC markets the top-selling 250 stocks over a 10- year period 30 stocks that are considered representative of the market as a whole The American stock exchange that specializes in new or high technology stocks is called the OTC NYSE Commodity Market The S&P 500 gives a picture of 500 stocks traded on the NYSE different American stock exchanges OTC market How is the exchange different from the New York Stock? it is all done electronically it has locations in many cities it only deals in new companies it only handles foreign companies The majority of stocks in the United States are traded on.. the Over-the- Counter market the American Stock Wall Street the New York Stock The over-the-counter market deals with American companies that do business in Europe stocks not listed on major exchanges companies that do not allow public trading of their stocks only foreign securities Standard & Poor's is a firm that regulates banks provides banks loans insures banks rates bonds The Dow Jones Industrial Average consists of 60 stocks selected from the NVSE, the NASDAQ and OTC markets the top-selling 250 stocks over a 10- year period 30 stocks that are considered representative of the market as a whole 500 different stocks that change annually

7 On the stock exchange report below: What stock gained the most value on the day shown? Exxon Mobile America Ford Motor FedEx On the stock exchange report below: What stock has reached the highest price in the past year? Exxon Mobile America Ford Motor FedEx On the stock exchange report below: Which stock pays a dividend to the owners of the stock? FedEx America Ford Motor all of these On the stock exchange report below: What stock has traded over the widest range of prices in the past year? Exxon Mobile America Ford Motor FedEx A stock market that is steadily falling and expected to fall further is called a.. failed market strong market bull market bear market A stock market that is steadily rising and expected to rise higher is known as a... bear market investors market inflationary market bull market On the stock exchange report below: What stock lost the most value on the day shown? Exxon Mobile America Ford Motor FedEx A spyder fund invests money in.. only small only companies companies that need traded in foreign extra support markets bonds issued by the all the compaines in a specific industry A spyder fund invests money in.. all the companies in a specific part of the market foreign owned companies doing business in the U.S. companies that are tied to government contracts only small companies that need extra support A agreement to buy or sell a financial asset on a predetermined date in the future is known as a.. commodity markets over the counter transaction futures contract A contract that gives the holder the right to sell a asset in the future is known as a.. commodity trade call option put option Most futures trading in done in international exchanges known as.. over the counter markets spot markets bull markets bear markets A contract that gives the holder the right to buy a asset in the future is known as a.. commodity trade call option put option Contracts that give the investor the right to buy or sell stock at some point in the future is known as commodity markets trends options portfolios What 2002 law made listing a company on any of the American exchanges much more difficult? Colfax Disclosure Act Paternoster Investment Act Sherman Anti-Trust Act Sarbanes-Oxley Act Rosneft Oil Co. shocked the world when they decided to list their new publicly traded shares on the London Stock Chicago Stock New York Stock