FIN350 Exam 3 Prep (CH. 6-8)

The size of the firm measured as the current stock price multiplied by the number of shares outstanding.

Are municipal bonds federal tax exempt

Markets that trade debt securities or instruments with maturities of less than one year.

Markets in which corporations raise funds through new issues of securities?

The ease with which an asset can be converted into cash.

Which theory says the current yield curve reflects the market's current expectations of future short-term rates.

The interest rate that would be exist on a risk-free security if no inflation were expected.

Current stock price divided by four quarters of earnings per share

A stock buy or sell order at a specific price. It will only be executed if the mrkt price meets the specified price

Funds provided to the financial markets by net suppliers of funds.

The annual amount of interest paid expressed as a percentage of the bond's par value.

The risk that a security cannot be sold at a fair market price with low transaction costs on short notice.

Return from interest payments; computed as the annual interest payment divided by the current bond price.

A contributing factor to the 2007-2009 mortgage crisis

A popular index of 30 large, industry-leading firms.

The last four quarters of dividend income expressed as a percentage of the current stock price.

High credit quality corporate bonds.

Unsecured Bonds

The total return the bond offers if purchased at the current price and held to maturity.

Legal contract describing the bond characteristics and the bondholder and issuer rights