D775 Introduction to Business Finance Questions
with Correct Answers
3 types of financial insturments
stock, bond, derivatives
stocks
certificates that represent ownership interest
bond
loans sold to raise capital; provide a fixed income stream through interest payments and the
return of principal maturity; recorded under liabilities on balance sheet
derivatives
contracts whose value is derived from some other entity (usually an asset of some kind); used
to hedge against or speculate on risk
6 types of financial markets
public, private
primary, secondary
dealer, auction
financial markets definition
where buyers and sellers can trade financial assets
4 types of financial institutions
depositary, investment, insurance, pension fund
7 economic indicators
,GDP, CPI, PPI, consumer spending, unemployment rate, yield curve, interest rate
GDP acronym
Gross Domestic Product (acronym)
GDP definition
(definition) value of goods and services produced in an economy
CPI acroynm
Consumer Price Index (acronym)
CPI definition
(definition) cost of living changes over time; economic indicator that measures changes in the
price level of a market portfolio
PPI acronym
producer price index (acronym)
PPI definition
(definition) average change over time in selling prices received by domestic producers for
their output
2 factors in inflation
CPI and PPI
consumer spending
economic indicators based on total consumer spending
yield curve predictions
, economic indicator that predicts the direction of interest rates and economic expansion or
contraction
accounting
systematic recording, reporting, and analysis of financial transactions
accounting outputs
balance sheets, income statements, cash flow statements
finance
management of assets and liabilities, and planning for future growth and stability
finance outputs
investment portfolios, financial strategies, budgets
3 types of finance
personal, public, business
public finance
management of govt renues, expenditures, and debt load through govt institutions
examples of public finance
tax collection, govt spending, budgeting, public debt issuance
business finance
financial activities of companies
business finance examples
capital investment decisions, financing methods, dividend policies, risk management
with Correct Answers
3 types of financial insturments
stock, bond, derivatives
stocks
certificates that represent ownership interest
bond
loans sold to raise capital; provide a fixed income stream through interest payments and the
return of principal maturity; recorded under liabilities on balance sheet
derivatives
contracts whose value is derived from some other entity (usually an asset of some kind); used
to hedge against or speculate on risk
6 types of financial markets
public, private
primary, secondary
dealer, auction
financial markets definition
where buyers and sellers can trade financial assets
4 types of financial institutions
depositary, investment, insurance, pension fund
7 economic indicators
,GDP, CPI, PPI, consumer spending, unemployment rate, yield curve, interest rate
GDP acronym
Gross Domestic Product (acronym)
GDP definition
(definition) value of goods and services produced in an economy
CPI acroynm
Consumer Price Index (acronym)
CPI definition
(definition) cost of living changes over time; economic indicator that measures changes in the
price level of a market portfolio
PPI acronym
producer price index (acronym)
PPI definition
(definition) average change over time in selling prices received by domestic producers for
their output
2 factors in inflation
CPI and PPI
consumer spending
economic indicators based on total consumer spending
yield curve predictions
, economic indicator that predicts the direction of interest rates and economic expansion or
contraction
accounting
systematic recording, reporting, and analysis of financial transactions
accounting outputs
balance sheets, income statements, cash flow statements
finance
management of assets and liabilities, and planning for future growth and stability
finance outputs
investment portfolios, financial strategies, budgets
3 types of finance
personal, public, business
public finance
management of govt renues, expenditures, and debt load through govt institutions
examples of public finance
tax collection, govt spending, budgeting, public debt issuance
business finance
financial activities of companies
business finance examples
capital investment decisions, financing methods, dividend policies, risk management
