WEEK 4 Flashcards
trading one good or service for another.
Barter
which means a
situation where two people each want some good or service that the other person can provide.
Double Coincidence of Wants
consists of objects that have value in themselves as well as value in their
use as money.
Commodity Money
is a legal tender whose value is backed by the government that issued it.(ex: Paper
bills, and coins)
Fiat Money
generally refers to means of accessing financial services and conducting
transactions on a mobile device.
Mobile Payment
M1 Money Supply
Coins and currency in circulation
Demand deposits
M2 Money Supply
Saving Deposits
Money Market Funds
Certificates of Deposit / Time Deposits
between savers and borrowers and direct the flow of funds between the two groups.
Financial Intermediaries
economic resources.
Financial Capital
Four main ways that businesses raise financial capital:
- Early-stage Capital
- Profits
- Bonds
- Stocks
is when a business owner uses his/her own money or seeks money from an angel investor or venture capital firm to get a business started.
Early-Stage Capital
If a firm’s revenues are greater than costs and they are earning profits,
Profits
is issued by firms, but bonds are also issued by various levels of government.
Corporate Bond
Anyone who owns a bond and receives the interest payments is called a _____.
Bondholder
is a financial contract: the borrower agrees to repay the amount that was borrowed and
also a rate of interest over a period of time in the future.
Bond
are a way to raise capital by selling ownership or equity; an investment for
shareholders that creates return through the distribution of corporate profits as dividends or
through gains in corporate value; traded on stock exchanges through member brokers.
Stocks
has the right to vote and attend general meeting
Common Stock
Priority to get the dividend
Preferred Stock
The firm can make a direct payment to its shareholders called a _____.
Dividend
a financial investor might buy a share of stock and then later sell it for a higher
price – the increase in value of the stock between when it is bought and when it is sold is called _____.
Capital Gain
is owned by the people who run it on a day-to-day basis.
Private Company
When a firm decides to sell stock, which in turn can be bought and sold by financial investors, it
is called a _______.
Public Company
