Chapter 13 + 14 Deck Flashcards
The fact that people are willing to save money for future purposes describes which function of money ( ).
store of value
An ( ) is the process of taking a privately held company public by selling stock for the first time.
initial public offering (IPO)
Your ( ) schedule is the schedule by which you’ll reduce the balance of your debt.
amortization
The Fed performs all of the following functions except:
regulating state banks.
As founder and CEO of a growing public company, you are considering issuing shares of stock to finance an expansion. All of the following statements about stock are true except:
if you issue stock to the public, your percentage ownership of the company will not change.
When Pete Peterson took out a small business loan, the bank asked for security in the form of ( ).
collateral
The ( ) is the amount by which an initial bank deposit will expand the money supply.
money multiplier
The process of raising capital through the sale of a company’s stock is called ( ) financing.
equity
( ) stock gives its owner the option of exchanging it for common stock.
convertible preferred
( ) is the risk that poor management of an organization with which you’re dealing may adversely affect your personal-finances planning, while ( ) is the risk associated with a product that you’ve chosen to buy.
management risk/business risk
Examples of personal liabilities include the following except:
tuition
You are more likely to qualify for a loan if you ( ).
have a history of borrowing
Monetary or liquid assets include all of the following except ( ).
cars
When there is a difference between an amount in the “budget” column and the corresponding amount in the “actual” column, the difference, whether plus or minus, is recorded as a(n) ( ).
variance
A ( ) is a document that itemizes expected sources of income and expenditures for the coming year, along with the relevant money amounts for each.
budget
In addition to the itemized lists of inflows and outflows, there are three other columns in a budget. They are ( ).
budget, actual, and variance
In 2006 and 2007, largely because of ( ) , banks and other institutions that made mortgage loans began losing huge sums of money.
mortgage loan defaults
In compiling your credit score, the credit bureaus considers all of the following except ( ).
income
Your ( ) is the difference between your assets and your liabilities.
net worth
Money serves three functions:
- a medium of exchange
- a measure of value
- a store of value
In a ( ) system, goods and services are traded directly for one another.
bartered
Because of ( ) you can use it to buy the goods and services you want, everyone’s willing to trade things for money.
medium of exchange
( ) simplifies the exchange process because it’s a means of indicating how much something costs.
measure of value
( ) makes it so people are willing to hold onto it because they’re confident that it will keep its value over time.
store of value
The government uses two measures to track the money supply: ( ) includes the most liquid forms of money, such as cash and checking-account funds. ( ) includes everything in M-1 plus near-cash items, such as savings accounts and time deposits below $100,000.
M-1/M-2
Most common types of depository institutions:
banks that accept deposits, including commercial banks, savings banks, and credit unions
( ) provide financial services but don’t accept deposits They include finance companies, insurance companies, brokerage firms, and pension funds.
nondepository institutions
A bank holds onto only a fraction of the money that it takes in—an amount called its ( ).
reserves
A ( ) invests money from a pool of investors in stocks, bonds, and other securities.
mutual fund
Most large banks are members of the central banking system called the ( ).
Federal Reserve System (the Fed)
