Chapter 8 Flashcards
1
Q
Financial markets
A
Financial institutions through which savers can directly provide funds to borrowers
2
Q
Bondq
A
certificate of indebtedness that specifies the obligation of the borrower to the holder of the bond
3
Q
Equity finance
A
Sale of stock to raise money
4
Q
Stock
A
Represents ownership in a firm and is, therefore a claim to its profits
5
Q
Stock index
A
An average of a group of stock prices
6
Q
Financial intermediaries
A
Financial institutions through which savers can indirectly provide funds to borrowers
7
Q
Bank
A
Primary function of a bank is to take deposits from savers and use these deposits to make loans to people who want to borrow
8
Q
Mutual fundss
A
An institution that sells shares to the public and uses the proceeds to buy a portfolio of stocks and bonds
9
Q
A
