Financial Markets and Instruments: Definitions and Concepts, Quizzes of Banking and Finance

Download Financial Markets and Instruments: Definitions and Concepts and more Quizzes Banking and Finance in PDF only on Docsity! TERM 1 Financial Markets DEFINITION 1 markets in which funds are transferred from people who have an excess of available funds to people who have a shortage TERM 2 Security DEFINITION 2 aka financial instrument; is a claim on the issuer's future income TERM 3 Assets DEFINITION 3 any financial claim or piece of property that is subject to ownership TERM 4 Bond DEFINITION 4 is a debt security that promises to make payments periodically for a specified period of time TERM 5 Interest Rate DEFINITION 5 is the cost of borrowing or the price paid for the rental of funds TERM 6 Common Stock DEFINITION 6 represents a share of ownership in a corportation TERM 7 Financial Intermediaries DEFINITION 7 institutions that borrow funds from people who have saved and in turn make loans to others TERM 8 Financial Crises DEFINITION 8 major disruptions in financial markets that are characterized by sharp declines in asset prices and the failures of many financial and non-financial firms TERM 9 Banks DEFINITION 9 are financial institutions that accept deposits and make loans TERM 10 E-Finance DEFINITION 10 the new means of delivering financial services electronically TERM 21 Central Bank DEFINITION 21 the organization responsible for the conduct of a nation's monetary policy (U.S. Federal Reserve System) TERM 22 Fiscal Policy DEFINITION 22 involves decisions about government spending and taxation TERM 23 Budget Deficit DEFINITION 23 is the excess of government expenditures over tax revenues for a particular time period, usually a year TERM 24 Budget Surplus DEFINITION 24 arises when tax revenues exceed government expenditures TERM 25 Gross Domestic Product DEFINITION 25 GDP, a measure of aggregate output described in the appendix of this chapter TERM 26 Foreign Exchange Market DEFINITION 26 is where the conversion takes place; so it is instrumental in moving funds between countries TERM 27 Foreign Exchange Rate DEFINITION 27 the price of one country's currency in terms of another's