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FMGT 80 > MIDTERM EXAM > Flashcards

MIDTERM EXAM Flashcards

1
Q

They conduct financial sector assessments
of countries that they help. It is
imperative that they
monitor the financial standing of
country borrowers.

A

International Monetary Fund (IMF) and
World Bank (WB)

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2
Q

These are designed to assess the stability of
the financial system as a whole and not that of individual
institutions. It has been developed to help countries identify and remedy weaknesses in their financial sector
structure, thereby enhancing their resilience to macroeconomic shocks and cross-border contagion.

A

FSAP Assessments (Financial Sector Assessment Program)

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3
Q

describes collectively the financial
markets ,the financial system participants, and the
financial instruments and securities that are traded in the financial markets.

A

Financial System

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4
Q

What is one important function of financial system?

A

to allocate money to the most productive investment projects in the economy.

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5
Q

A basic function of financial system where a way of getting deposits and necessary funds to finance projects and investments

A

Fund Acquisition

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6
Q

A basic function of financial system where it is determining to which uses, projects, or investments the acquired funds will be used.

A

Fund Allocation

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7
Q

A basic function of financial system where it is the process by which necessary funds are given to the uses, projects, or investment that need funds.

A

Fund Distribution

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8
Q

A basic function of financial system where it is using the funds for its intended purpose

A

Fund utilization

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9
Q

Who are the financial system participants?

A
  1. Household and Consumers
  2. Financial Institutions/Intermediaries
  3. Non-financial institutions
  4. Government
  5. Central Bank
  6. Foreign Participants
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10
Q

Are generally described as the group that
receives income majority of which typically
comes form wages and salaries.

A

Households or Consumers

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11
Q

Are the firms that bridge the gap between
surplus units (SUs) or investors/lenders and
deficit units (DUs) or borrowers. They channel funds form lenders to borrowers. They include depository institutions and non depository institutions

A

Financial Institutions/Intermediaries

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12
Q

Are businesses other than financial institutions or intermediaries. They include trading, manufacturing, extractive industries, construction, genetic industries, and all the
firms other than the financial ones.

A

Non-financial Institutions

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13
Q

Means the national, provincial, municipal or
city governments, and barangays or towns
comprising the Philippines as a whole. Each
division has its heads and agencies that help in running the division they are responsible for.

A

Government

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14
Q

are mandated to ensure that their respective countries have a stable and healthy
financial system. They oversee the operations of their entire financial system and mandate the rules, regulations, and monetary policies that will help them
maintain a healthy and stable economy.

A

Central Bank

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15
Q

Refer to the participants from the rest of the world- households, governments, financial and non-financial firms, and central banks. Goods and services and financial instruments/securities are exchanged across national boundaries, as well as within boundaries.

A

Foreign Participants

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16
Q

It was established on January 3, 1949 as the
country’s central monetary authority.

A

The Philippine Financial System

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17
Q

It was established on July 3, 1993 pursuant to the provisions of the 1987 Constitution and Republic Act No. 7653, the New Central Bank Act of 1993 to replace the Central Bank of the Philippines. They enjoy fiscal and administrative autonomy in the pursuits of its mandated responsibilities.

A

Bangko Sentral ng Pilipinas

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18
Q

the first governor of the Central
Bank of the Philippines initiated the concept of central bank in 1933.

A

Miguel Cuaderno

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19
Q

What is the organizational structure?

A

• Monetary Board
- Governor
a. Monetary and Economics Sector
b. Financial Supervision Sector
c. Corporate Services Sector
d. Payments & Currency Management Sector

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20
Q

What is in the Capital Markets?

A

BSP’s main job is to make sure everything is financially healthy and the economy stays steady. They’re the big decision-makers when it comes to money matters.

In those pictures (Figure 6 and 7), they’re basically showing how BSP fits into the mix of different banks and financial groups. BSP’s main goal is to control the flow of money in the whole country. They want to keep things stable and help the country grow economically. It’s like they’re the captains steering the ship of the Philippines’ money matters.

Under BSP, you’ve got different types of banks – some are private, some are run by the government. Same goes for non-bank financial groups. BSP is like the coach, guiding these teams of banks to play well together. Ultimately, BSP’s big mission is to make life better for everyone by fighting poverty and making sure money works the best it can for the whole country. They use different tricks (monetary instruments) to control things like prices, investments, and how much people earn and spend. It’s all about making the country’s wallet stronger and helping it grow.

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21
Q

It entitles a creditor to receive payment from a debtor in circumstances specified in a contract between them, oral or written.

A

Financial Claim

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22
Q

These are structures through which funds flow. They are the institutions and systems that facilitate transactions in all types of financial claim.

A

Financial Markets

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23
Q

These are markets in which users of funds (e.g., corporations) raise funds, through new issues offinancial instruments such as stocks and bonds (Saunders and Cornett 2011).

A

Primary Markets

24
Q

What are the original or new issues of securities?

A

Primary Securities

25
Q

Most primary market transactions are done through investment banks which are also called this. They purchase shares issued by the issuing company in an underwriting transaction and then sell these issues to the public.

A

Merchant Banks

26
Q

guarantees the sale of the issues, but does not incend to hold the shares or bonds in his own account.

A

Underwriter

27
Q

These are markets for currently outstanding securities, these securities were previously bought and owned and now being resold either by the initial investors or those who have purchased securities in this

A

Secondary Markets

28
Q

It s a financial institution organized usually as a corporation or a partnership. which principal business is to buy and sell securities, whether registered or exempt from registration for the dealer’s own account or the client’s.

A

Securities Dealer

29
Q

It is equal to the current income less current expenditures.

A

Gross Savings

30
Q

These are the goods that are consumed within a current period.

A

Non-durable goods

31
Q

These are the goods that will last for more than a year.

A

Durable Goods

32
Q

It is the Philippine Independence Bill.

A

Tydings McDuffie Act

33
Q

It is the Central Bank Act of 1948.

A

R.A no. 265

34
Q

It exercises the powers and functions of BSP.

A

Monetary Board

35
Q

It is the BSP sector that is in charged of the formulation and implementation of the BSP’s
monetary policy.

A

Monetary Stability Sector

36
Q

It is the BSP sector that enforces and monitors compliance in banking laws to promote a sound and healthy banking system.

A

Financial Supervision Sector

37
Q

It is the BSP sector that serves the human, financial, and physical resources need of BSP.

A

Resource Management Sector

38
Q

It directly supervises cooperatives.

A

Cooperative Development Authority

39
Q

ít is the function of the BSP involving monopoly of printing money bills and minting money coins.

A

Bank and Issue

40
Q

It is the manipulation of money supply to affect the economy of the country.

A

Monetary Policy

41
Q

It is the operation involving buying and selling government securities.

A

Open Market Operations

42
Q

True or False? Financial system channel funds from deficit units to saving units.

A

False

43
Q

True or False? Financial system provides a medium of exchange.

A

True

44
Q

True or False? Households and families do not include single individuals in terms of financial system.

A

False

45
Q

True or False? The powers and functions of BSP are exercised by its Monetary Board.

A

True

46
Q

True or False? FSAP assessments are designed to assess the stability of the financial system of a country.

A

True

47
Q

True or False? Under Republic Act No. 7653, the New Central Bank Act, one of the government sector members of the Monetary Board must also be a member of the Cabinet appointed by the President.

A

True

48
Q

True or False? Increases in the money supply push short-term interest rates up, encouraging investments and consumptions.

A

True

49
Q

True or False? In the long run, an abundance of money supply will lead to increase in prices.

A

True

50
Q

True or False? BSP may lower interest rates and stimulate investment and consumption in the long run.

A

True

51
Q

True or False? When BSP sells securities, money supply increases.

A

False

52
Q

True or False? When BSP increases the reserve requirement for banks, the amount available to banks for lending to borrowers reduces, limiting the credit and ultimately the money supply.

A

True

53
Q

True or False? Increases in the money supply push interest rates up, which stimulate money demand.

A

False

54
Q

True or False? The Monetary Board has nine members.

A

False

55
Q

True or False? Cooperatives are directly under BSP.

A

False

56
Q

True or False? Private Insurance companies are under Insurance Commission

A

True

FMGT 80 (3 decks)

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