Econ Ch. 11 Review

short-term obligation with a maturity of 4, 13, or 26 weeks.

purchased by investors as long-term investments, but can be quickly sold if investors need cash for other purposes

argument that stocks are usually priced correctly & that bargains are hard to find b/c stocks are followed closely

What is a document showing that an investor has made an interest-bearing loan to a bank?

What is the coupon rate of a bond?

Dollars that become available when people abstain from consumption

US government obligations with maturities of 2 to 10 years

The market value of a mutual fund share is called the

banks and credit unions, life insurance companies, pension funds are all examples of what?

What is the maturity of a bond?

the right to buy something at a specific future price

a place where buyers and sellers meet to trade stocks.

Issued by state and local governments and are tax-exempt

existing financial assets can be resold to new owners.

The main implication for the investor is that if all stocks are priced incorrectly,

shares of common stocks that represent ownership of corporations that is available to investors.

an electronic marketplace for securities that are not traded on an organized exchange such as the NYSE.

a “strong” market with the prices moving up for several months or years in a row

a tax- deferred investment and savings plan that acts as a personal pension fund for employees.

Market in which money is loaned for more than one year.

What is the absence of spending?

an agreement to buy or sell at a specific future date at a pre-determined price.

In order to compare bonds, investors usually compute the bond’s _____ the annual interest divided by the purchase price.

For an economic system to grow, it must produce what?

What is the par value of a bond?

the most popular and widely publicized measure of stock market performance

practice of holding a large number of different stocks so that increases in some stocks can offset declines in others

long-term, tax-sheltered time deposits that can be set up as part of an individual retirement plan.

have maturity dates ranging from more than 10 to as many as 30 years.

a special type of futures contract that gives the buyer the right to cancel the contract

exceptionally risky bonds

the right to sell something at a specific future price.

a market where only the original issuer can sell or repurchase a financial asset.

low-denomination non transferable bonds issued by the U.S. government that are also called EE savings

transaction is made immediately at the prevailing price.

Which of the following is the highest rate of bond?

regular payment intended to provide income security to someone who has worked a certain number of years, reached an age

money is loaned for periods of less than one year

Financial Systems are made up four parts?

§a “mean” or “nasty” market, with the prices of equities falling sharply for several months or years in a row.

It uses the price changes of 500 representative stocks as an indicator of overall market performance

A mutual fund is a company that sells stock in itself to individual investors

A person who buys or sells equities for clients, can also open an Internet account with a discount brokerage firm.