unit 4

Question 1

Whats Finance

Answer 1

The study of money management which includes saving, lending, spending and borrowing money

Question 2

Whats Exchange

Answer 2

giving something in order to obtain something else

Question 3

What are the 3 Factors Influencing Exchange

Answer 3

Value (price)
Time(need or want)
Personal Preference

Question 4

What are the 4 Forms of Financial Exchange

Answer 4

Cash
Credit
Debit
Electronic Fund Transfer(EFT)

Question 5

Whats Electronic Fund Transfer(EFT

Answer 5

• is a system of transferring money from one bank account directly to another without any paper money changing hands

Question 6

What are the Types of Currency

Answer 6

Paper Money- printed in Fort Worth and Washington DC
Coins- minted in Philadelphia, Denver, San Francisco and west point, NY
Banknote- a note issued by a bank representing its promise to pay a specific sum to the bearer on demand and acceptable as money

Question 7

Whats a Treasury Bond

Answer 7

pay a fixed rate of interest every six months until they mature, they are issued in a term of 20 years or 30 years *LONG TERM INVESTMENT

Question 8

Whats a Treasury Note

Answer 8

earn a fixed rate of interest every six months until maturity notes are issued in terms of 2,3,5,7, and 10 years* SHORT TERM INVESTMENT

Question 9

What are the Functions of Money

Answer 9

Medium of Exchange- anything people will accept in exchange for good or services
Unit of Measure- money determines the value of a good or service in dollar terms
Store of Value- money can be saved and retrieved at a later date with the potential of greater value

Question 10

What are the Source of Income

Answer 10

Wage
Salary
Interest
Rent
Dividends
Transfer payment

Question 11

Whats The time Value of Money

Answer 11

The value of money figuring in a given amount of interest earned over a given amount of time