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H AC 1 > Super Extra Special Wonderful Section > Flashcards

Super Extra Special Wonderful Section Flashcards

1
Q

Shareholders

A

group of owners of a corporation

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2
Q

Publicly Held Company

A

Owned by THOUSANDS who trade shares among public stock exchange
Large Business

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3
Q

Privately Held Company

A

Owned by SMALL # of ppl who know each other
Small Business
Start off as this, grow to public

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4
Q

Inflation

A

Too much money not enough stuff
Ebay
Shortage of goods so prices go up

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5
Q

Deflation

A

Too much stuff not enough money
TJ Maxx
Abundance of goods that ppl don’t buy

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6
Q

Equilibrium Point

A

Product demand = product produced
Supply = demand
No abundance, no shortage

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7
Q

When lots of people want stock the price is _________

A

Driven up

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8
Q

When more people want to sell stock than buy it, prices __________

A

Go down

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9
Q

Stock prices will rise when a company….

A

Reports
- Good earnings
- New product
- Merges with another company

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10
Q

Stock prices will decline when a company….

A

Reports
- loss in earnings
- announces reorganization that will reduce profits

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11
Q

Quotation

A

Purchasing price of a stock at a particular time

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12
Q

NYSE ?

A

New York Stock Exchange = largest security market

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13
Q

NASDAQ

A

National Association of Securities Dealers Automated Quotations = technology market

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14
Q

Dow Jones

A

Average price of 10 selected industrial stocks used as a measure for general market trends

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15
Q

Bull Market

A

Stock prices rising
Bull shoots up

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16
Q

Bear Market

A

Stock prices dropping
Bear throws down

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17
Q

A bull expects _____

A

prices to rise

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18
Q

A bear expects ______

A

prices to drop

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19
Q

3 main sectors of US market economy

A

Businesses, households, government

20
Q

Business IN

A

Services + Products

21
Q

Business OUT

A

Expenses + Taxes

22
Q

Household IN

A

Wages + Payments

23
Q

Household OUT

A

Consumption + Taxes

24
Q

Government IN

A

Taxes

25
Q

Government OUT

A

Services + Expenses

26
Q

Commercial banks report to ______

A

The Federal Reserve

27
Q

Federal Reserve has _____ banks

A

12

28
Q

Federal Reserve is controlled by ______________ which are _______________.

A
  • the Board of Governors of the Federal Reserve
  • appointed by the president and congress
29
Q

Board of Governors is made up of

A

Open Market Committee and Advisory Council

30
Q

Fiscal Tool

A

GOVERNMENT
slow to work

31
Q

Monetary Tool

A

FED RESERVE
can happen quickly

32
Q

Expansionary Tool

A

INCREASE # of money in circulation
inflate balloon

33
Q

Contractionary Tool

A

DECREASE # of money in circulation
deflate balloon

34
Q

Fiscal Expansionary Tools:

A
  1. Increase government spending (puts more $ in)
  2. Cut taxes (more $ to spend)
35
Q

Monetary Expansionary Tools:

A
  1. Open market operations - securities + bond purchases
    - Reserve buys back bonds so more $ is in economy and not sitting in a bond
  2. Decrease interest rate (borrowing $ is cheaper)
  3. Decrease Reserve Requirements
36
Q

Fiscal Contractionary Tools:

A
  1. Decrease government spending
  2. Raise taxes
37
Q

Monetary Contractionary Tools:

A
  1. Open market operations - securities and bond sales
    - sells bonds to collect $ from circulation
  2. Increase the interest rate (borrowing $ is more expensive)
  3. Increase Reserve Requirements
38
Q

Reserve Requirements

A

Amount of physical money a commercial bank is required to keep in the actual bank

39
Q

Money goes INto a bank through:

A

Deposits, payments, interest + fees

40
Q

Money goes OUT of a bank through:

A

Withdrawals, loans, expenses, and interest/payments

41
Q

Bank expenses can only be paid for with _______

A

Gross profit

42
Q

Gross profit

A

Money the bank actually has
NOT money the bank is borrowing from people who have put $ into the bank

43
Q

Loans have ________ and ___________

A

Principle
Interest

44
Q

Principle (loans)

A

Amount of payment actually owed that was borrowed

45
Q

Interest (loans)

A

“Thank you” to the bank for letting me borrow money

H AC 1 (5 decks)

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