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finance Correct Answers is concerned with decisions about money and cash flows the three concepts to make sound found financial decisons Correct Answers 1. more value is preferred to less 2. the sooner cash is received, the more valuable it is 3. less risky assets are more valuable than riskier assets financial markets Correct Answers provide the mechanisms that permit borrowers and lenders to transfer funds among each other whether the transfers are direct or indirect financial insti...

Finance Correct Answers The study of how and under what terms funds are allocated between those with excess fund and those who need funds. How can we view finance as "applied economics"? Correct Answers Economics deals with the allocation of scarce resources in an economy, whereas finance focuses on how resources are allocated and by what channels, as well as the terms of the allocation. What are the 3 primary areas of finance? Correct Answers Financial Institutions, Business (Corporate)...

capital budgeting or capital expenditure (CAPEX) decision Correct Answers decision to invest in tangible or intangible assets financing decision Correct Answers form and amount of financing of a firm's investments equity investors Correct Answers investors in a company who become shareholders by contributing equity financing debt investors Correct Answers when investors lend money to a company and will eventually need to be repaid. Real assets Correct Answers acquired by invest...

Financial Market Correct Answers A market in which financial assets (securities) such as stocks and bonds can be purchased or sold. Funds are transferred in financial markets when one party purchases financial assets previously held by another party. Role of Financial Markets Correct Answers Transfer funds from those who have excess funds to those who need funds. Accommodating Corporate Finance Needs: The financial markets serves as the mechanism whereby corporations (acting as deficit uni...

stock exchanges Correct Answers • organizations that allow people the ability to buy and sell stocks • provide a convenient environment that allows buyers and sellers to act quickly and easily • when buyers and sellers agree on a price, a trade occurs bid price Correct Answers the price that buyers are willing to pay ask price Correct Answers the price that sellers are wanting to sell at market price order Correct Answers • when you are willing to accept prices currently being...

Liquidity Correct Answers means that investors can turn their financial securities into cash easily without losing significant value. Treasury Securities Correct Answers A debt instrument (bond) that is issued by the US government in order to raise capital. Revenues Correct Answers The top line of the income statement. The total amount of money a business brings in (before subtracting any costs) Corporate Bonds Correct Answers A debt instrument that is issued by a corporation in order t...

Importance of Financial Markets Correct Answers -Allow companies, governments and individuals to increase their utility --Savers have the ability to invest assets so they can earn a return --Borrowers have better access to capital so that they can invest in productive assets -Provided us with info about the returns that are required for various levels of risk Average Returns Correct Answers -Large Stocks 12.3% -Small Stock 17.1% -Long-term Corporate 6.2% -Long-term Government 5.8% -US ...

VaR Correct Answers Value at risk, variance 1% one year VaR of 10 million Correct Answers 1% chance portfolio will lose 10$ mil in one year stress test Correct Answers popular as of 2009, Dodd Frank, fed has to 3 diff scenarios for non bank entities it supervises annually Freddie Mac & ginne mae did stress tests for 13% in 2005 Correct Answers home prices dropped 30% Stress test pros and cons Correct Answers show legitimacy, incentivizes white washing Dodd Frank Correct Answers Su...

accuracy Correct Answers the degree of correctness which a student achieves when using grammar, vocabulary and pronunciation. acquisition Correct Answers a subconscious process; the effortless mastery of language through being exposed to it, rather than consciously learning it. adjectives Correct Answers words like big, old, exciting, expensive which are used to describe things, places, people, events, etc. adverbs Correct Answers words used to say when or how something happens. For exa...

the Blue Book Correct Answers The official booklet where you record lessons taught, classes observed, and where we track your progress. So called because it is indeed blue. Also called CELTA5. Kept in your portfolio.Communicative (adj) Involving the transfer of real information that has meaning for the students. Learners have to listen to one another to do a communicative task. CELTA 5 Correct Answers Another name is the Blue Book. It is so-called because there are 4 other administrative docu...