Business Mathematics and Business Organization

Question 1

Is a type of mathematics that is meant to teach people about money and provide them with the tools they need to make informed financial decisions.

Answer 1

Business Math

Question 2

These are the suppliers of Funds

Answer 2

Individuals

Question 3

These are the demanders of Funds

Answer 3

Businesses and Governments

Question 4

Is a network of various institutions that generate, circulate, and control money and credit

Answer 4

Financial Systems

Question 5

Are intermediaries that channel the savings of individuals, businesses, and governments into loans or investments

Answer 5

Financial Institutions

Question 6

Considered as depository institution

Answer 6

Banks

Question 7

Considered as contractual savings institution

Answer 7

Non-bank financial institution such as insurance and pre-need companies

Question 8

Are forums in which the supplier and demanders of funds transact directly.

Answer 8

Financial Markets

Question 9

a good place for individuals, banks, other companies, and governments to park cash for a short period of time, usually one year or less.

Answer 9

Money Market

Question 10

is where stocks and bonds are traded, geared toward long-term investing

Answer 10

Capital Market

Question 11

Type of business with a single owner or owned by one person who operates it for his or her own profit

Answer 11

Sole Proprietorship

Question 12

There is no legal distinction between the business and the owner.

Answer 12

Single Proprietorship

Question 13

Most popular forms of business because of its simplicity and ease of operation.

Answer 13

Sole Proprietorship

Question 14

Has two or more owners doing business together for a profit; Expected to combine their skills and their personal wealth.

Answer 14

Partnership

Question 15

Each of the partners can execute contracts that are binding, and each would be liable for all the partnership’s debts. This sharing of legal responsibility is known as

Answer 15

Joint and Several Liabilities

Question 16

Is a legal document that prescribes the way a business is managed as well as the relationship between each partner.

Answer 16

Partnership Agreement

Question 17

Is an entity created by law, owned by shareholders/stockholders who hold its common stock or preferred stock (equity) and enjoy many economic rights and responsibilities.

Answer 17

Corporation

Question 18

Can sue and be sued; can be tried and convicted for crimes; enter into and be a party to contracts; and acquire properties under its name.

Answer 18

Corporation

Question 19

Ownership claims (shares of common and preferred) can be freely traded among investors, without obtaining permission from other investors (for publicly traded companies).

Answer 19

Corporation

Question 20

Include key corporate personnel as well as outsiders who are typically successful private business people or executives of other major corporations.

Answer 20

Directors of Corporation

Question 21

Are responsible for hiring and firing key personnel (managers and executives) and setting corporate policies.

Answer 21

Directors

Question 22

Is responsible for managing the firm’s day-to-day operations and the implementation of the policies approved by the Board of Directors.

Answer 22

President/Chief Executive Officer (CEO)

Question 23

Is the highest-ranking body in a corporation, and the chairman of the board is the highest-ranking individual.

Answer 23

Board of Directors

Question 24

True or False

the CEO can attempt to have an individual member of the board be voted out and a new board member voted in whenever conflict arises.

Answer 24

True

Question 25

True or False

It is also possible for an individual to serve as CEO and chairman of the board at the same time.

Answer 25

True

Question 26

Is a legal document generated at the inception of the corporation and can be changed only by a vote of the shareholders.

Answer 26

The Corporate Charter

Question 27

Banks are established based on the following:
(sentences)

Answer 27

1.) Economic Justification of Banks - degree of competition, risk, potential customers, and availability of manpower have to be ascertained.

2.) Selection of Stockholders

3.) Determination of the kind of bank to be formed.

4.) Determination of the amount of capital to be raised.

Question 28

Bank officials are carefully selected based on the following qualifications.
(Sentences)

Answer 28

1.) Should be of good moral character.

2.) Have an adequate knowledge of the banking system.

3.) Equipped with the necessary capital.

4.) Known in the community as honest and righteous citizens.

5.) Able and willing to contribute to the bank’s success.

Question 29

Type of Corporation that Banks are required to be established as

Answer 29

Stock Corporation

Question 30

Shall prescribe, pass upon and review the qualification and disqualifications of individuals elected or appointed bank directors or officers and disqualify those found unfit.

Answer 30

Monetary Board

Question 31

To register a Bank under the Securities and Exchange Commission, it shall be accompanied by _______ issued by the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) under its seal.

Answer 31

Certificate of Authority

Question 32

Are set primarily to insure the protection of the depositors and investors.

Answer 32

Bank Reserves

Question 33

Three main classifications of reserves

Answer 33

1.) Primary Reserves
2.) Secondary Reserves
3.) Investment Reserves

Question 34

A reserve that consists of highly liquid assets of the bank and its main objective is to maintain the bank’s liquidity and solvency.

Answer 34

Primary Reserves

Question 35

A reserve of composed of earning assets that can easily be converted to cash with the least delay and without loss.

Answer 35

Secondary Reserves

Question 36

A assets (reserve) that do not qualify for the first two reserves. These are assets eligible for investment reserve, of longer maturities, and are expected to earn income.

Answer 36

Investment Reserves

Question 37

Two main functions of a bank

Answer 37

Deposit and Loan

Question 38

Other bank function not common knowledge of people

Answer 38

1.) Exchange function - deals with the transfer of funds

2.) Trust function - includes the administration of estates and the guardian of minor’s interest.

3.) Advisory function - includes providing advice on business dealings of clients.

Question 39

Other bank services include:

Answer 39

Rental of safety deposit boxes/vault

Sale of drafts and cashier’s check

Sale of traveler’s check

Collection agents

Credit information

Payrolls

Question 40

Are a type of safe usually located inside a bank vault or in the back of a bank. These boxes are typically used to store things such as valuable gemstones, precious metals, currency, or important documents.

Answer 40

Safe Deposit Vaults

Question 41

Enumerate the types of way a Safe Deposit Vault can be opened

Answer 41

1.) Assigned Key
2.) Bank Key
3.) Signature
4.) Code

Question 42

The bank function which constitutes as the lifeblood of banking institution

Answer 42

Deposit Function

Question 43

Type of deposit account that are withdrawn upon presentation of checks during banking hours. Also known as current account or checking account.

Answer 43

Demand deposits

Question 44

Type of deposit account that can only be withdrawn after a certain period of time or at a designated maturity.

Answer 44

Time Deposit

Question 45

A type of Time Deposit account that is most common among us which is evidenced by a passbook and/or an ATM and may be withdrawn on demand.

Answer 45

Savings Deposits

Question 46

A type of Time Deposit account that is evidenced by a certificate to the effect that the deposit can only be withdrawn at maturity or after due notice of withdrawal, usually 30 days and upon presentation and surrender of the instrument.

Answer 46

Time Certificate of Deposits

Question 47

A type of Time Deposit account that are allowed to a maximum of two withdrawals a month but the account should not fall below the minimum allowable balance as specified by the bank. Has a specific higher maintaining balance; Has higher interest than savings deposit.

Answer 47

Special Time Deposits

Question 48

True or False

Direct or primary deposits is made over the counter when the depositor him/herself brings his/her money and/or checks and other near cash items to the bank and hands them to the teller.

Answer 48

True

Question 49

True or False

Derivative deposits is created from the proceeds of loan or when the borrower enters into an arrangement that the bank places the loan proceeds under a current account from which he can draw checks eventually.

Answer 49

True

Question 50

The largest single source of income of the bank and extends to individuals, businesses, and governments.

Answer 50

Loan Function

Question 51

True or False

Loans and Discounts are different things

Answer 51

False

Question 52

Are advances on which interest is collected at maturity

Answer 52

Loans

Question 53

Are advances on which interest is deducted in advance.

Answer 53

Discounts

Question 54

Takes place when the creditor has the trust that the borrower is willing and able to pay (hint: answer is noun)

Answer 54

Credit

Question 55

The most common negotiable documents used by banks are

Answer 55

1.) Bills of exchange
2.) Promissory Note
3.) Check

Question 56

To be fully negotiable, an instrument must contain the following:
It must be in writing and signed by the drawer or maker.

It must be made payable to the order or the bearer.

It must be payable on demand or at a future determinable time.

There must be an unconditional order or promise to pay.

Answer 56

Please answer “2” unless you have been familiarized with it