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Economic Development (1st year, summer) > Chapter 8 > Flashcards

Chapter 8 Flashcards

1
Q

Most transactions use___and ____as they are considered a more efficient way to do business is compared to the barter system

A

Cash and near-cash items

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2
Q

Enumerate the three main roles of money

A
  1. Medium of exchange, as it is generally accepted as payment for goods and services
  2. a store of value, and the unit of account 3. a standard measurements that generally determines the value of things
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3
Q

Used as a medium of exchange; it has value because everyone thinks that it has value

A

Money

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4
Q

It is considered a legal tender, that currently, it is the form, by law, a debtor may require a creditor to accept in payment of a debt

A

Money

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5
Q

Gaining popularity in the digital financial system

A

Bitcoins

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6
Q

Are not regulated in any specific country, are considered a speculative asset, and are accepted by a few groups of people.

A

Bitcoins

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7
Q

Network of institutions, markets, and contracts, that bring together lenders and borrowers

A

Financial system

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8
Q

Two main players in the system

A
  1. Lenders
    2.borrowers
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9
Q

They believe that money that they have now has the potential of snowballing in the future. Hence they lend it to financial institutions like a bank.

A

Lenders

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10
Q

Can be a household that needs to buy, but does not have enough money and hand to acquire it; a firm that needs some more capital to fund an asset; or the government that typically spends more than it owns.

A

Borrowers

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11
Q

The lender is in Barrow were agreed to fulfill their goals a few exchanges in: (Enumerate them)

A
  1. Banking system.
  2. Government.
  3. Stock market.
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12
Q

This is where depositord are considered lenders, and those who loan funds for themselves, the bond market

A

Banking system

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13
Q

May choose to acquire its funds, by issuing an IOU promising to pay on a regular basis, and the principle at a certain date

A

Government

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14
Q

It is basically a place for ownership in a company may be sold and bought

A

Stock market

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15
Q

Fluctuations in the stock market are not dependable metrics of _____

A

Economic well-being

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16
Q

Changes in the stock market may just be reactions to _______in the performance of any economy or of the company

A

real or perceived changes

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17
Q

True or false
Money is a liability of the central bank

A

True

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18
Q

True or false
Real asset is something with intrinsic value

A

True

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19
Q

What are examples of financial system?

A
  1. Crowd sourcing of funds
  2. raising capital from investors
  3. distributing the risk that is attached to the investment
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20
Q

It means committing funds to one or more assets, which can be a financial or real asset

A

Investment

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21
Q

It may be understood as a part of wealth that may be used to fund the investment of another

A

Savings

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22
Q

It is someone else’s liability and are manufactured by the stock market, or any financial institution

A

Financial asset

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23
Q

Examples are valuable pieces of jewelry machines or other physical assets that may be traded in a hard market

A

Real asset

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24
Q

It means that the stock market creates assets, traded that are intangible

A

Manufactured

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25
Q

What are the five investment assets that are traded in the market?

A

Stocks
Bonds
Currencies
Real estate
Commodity

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26
Q

Securities that mature, and less than one year that are traded in the money market

A

Short term instruments

27
Q

Mature more than a year that are traded in the capital market

A

Long-term instruments

28
Q

forms of financial instrument value of which is derived from another instrument

A

Financial derivatives

29
Q

forms of financial instrument value of which is derived from another instrument

A

Financial derivatives

30
Q

An example of financial derivatives were in the stock is the base, and the option would be its derivative

A

Stock option

31
Q

It refers to the coins pieces of stamped metals used as a trading medium. Any currencies used in the same way

A

Money

32
Q

It means money on hand

A

Cash

33
Q

The market for longer loanable funds

A

Capital market

34
Q

Instruments used as evidence of a borrowers that to a lender. It is used by companies to finance.

A

Debentures

35
Q

Enumerate the process of investment

A

Portfolio management
Allocation of assets
Construction decision

36
Q

Building that collection or set of assets

A

Portfolio management

37
Q

Splitting of the portfolio into five or less types of investment classes

A

Allocation of assets

38
Q

Choosing from the top down or bottom up approaches in portfolio management

A

Construction decision

39
Q

Tries to allocate assets by country or region,, as well as the type of asset

A

Top down portfolio management

40
Q

Looking at specific company, then investing in it with the tendency of investing in just one country and or one class

A

Bottom up

41
Q

Involves channeling of funds, by means of financial intermediaries, transferring and scheduling of risks, appropriation of the investment class and managing ownership of funds

A

Investment management

42
Q

Examination of the control of a company as exercised by its directors

A

Corporate governance

43
Q

What are the key players in financial systems?

A

Firm
Household
Government
Financial intermediaries

44
Q

Businesses issuing securities, ( debt and equity) or financial instruments

A

Firm

45
Q

The one who lend in borrow from financial intermediaries

A

Household

46
Q

the one that never over funds and this considered always in shortage

A

Government

47
Q

It’s a one that positions between the debtors and the creditors

A

Financial intermediaries

48
Q

Are able to fund a technology based industry and employee more workers

A

Prospective venture capitalists

49
Q

Issued debenture and shares to public and other fund institutions that are expecting good returns from fixed or fixed assets

A

Capital markets

50
Q

Help address transactions that involve foreign currencies help raise funds for these companies and support the Forex requirement of some companies who are dealing with other countries

A

Foreign exchange markets

51
Q

Set as a policy is establishing development, banks and merchant banks to raise funding for infrastructure buildings

A

Economic liberalization

52
Q

Allow companies with investable fund stories in highly risky information and technology, business or promote other new ventures

A

Venture capitalist

53
Q

Would discourage migration from rural to urban areas

A

Equitable interest rates

54
Q

Having a good financial system allows balance in the industrial agriculture and service sectors

A

Sustain macro economics

55
Q

Equitable interest, interest interest rates offered in various places with discourage migration from rural to urban areas

A

Balance regional development

56
Q

Trade practice legislation, in terms of market, and the use of one common currency just like the European Union

A

Foster economic integration

57
Q

Vigorous financial systems in one economy, and potential investors in various sectors

A

Attract foreign investment

58
Q

Vigorous financial systems in one economy, and potential investors in various sectors

A

Attract foreign investment

59
Q

Loss and other legislation may be enforced to mitigate the risks of unwanted and speculative

A

Uphold fiscal policy

60
Q

Allows companies with investable funds to invest in highly risky information and technology, business or promote other new ventures

A

Infrastructure technology development

61
Q

It allows the issuance of letters of credit finance, them, and even offer to discount some financial instruments like bill

A

Trade development

62
Q

Helps address trans sections that involve foreign currencies help praise funds for these companies and support the Forex requirement

A

Capital securities market

63
Q

Opportunities for bunks and other financial institutions, like funds and other others, to have more skilled workers

A

Develop labor employment

Economic Development (1st year, summer) (3 decks)

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