D076 Finance Skills for Managers)-
Module 2 PASSED
A local start-up company just hit its five-year anniversary and is planning an initial public offering
sometime this year. In order to issue public stock, which market will the company use? - ✔✔✔Primary
market
When a company issues stock for the first time to raise capital, shares must initially be sold through a
primary market.
About a year ago, the short-term Treasury bill had 1.54% interest and the long-term Treasury note had
2.54% interest. This week, the 1-year Treasury bill has an interest rate of 3.13%, while the 10-year
Treasury note has an interest rate of 2.28%. What does this information indicate about the future
economy? - ✔✔✔It may indicate an economic downturn.
Since the long-term Treasury interest rate is lower than the short-term rate, it has an inverted yield
curve, which may indicate an economic downturn.
Auction market - ✔✔✔has a physical location where prices are determined by investors' willingness to
pay
(EX) New York Stock Exchange (NYSE)
bid-ask spread - ✔✔✔the difference between the bid price and the asked price
Capital Market - ✔✔✔market in which money is lent for periods longer than a year
coincident indicators - ✔✔✔collected, used, and analyzed as economic shifts happen
, analysts look at the big picture of the past changes to see future trends
examples: gross do(and personal income GDP increases, economy is strong and vice versa)
Corporate Bonds - ✔✔✔A debt instrument that is issued by a corporation in order to raise capital.
(EX) If Alphabet Inc. defaults and cannot repay the loan, the bondholders will have access to the
company's assets when they are liquidated during bankruptcy.
Dealer Market - ✔✔✔made up of multiple dealers that hold an inventory of securities and quote prices
(EX) NASDAQ
efficient market - ✔✔✔A market where prices reflect all available information.
In what way are coincident indicators useful? - ✔✔✔They analyzed during economic shifts to provide
information about the current state of the economy.
In which financial market are securities such as stocks and bonds are traded after their initial issuance? -
✔✔✔Secondary market
Financial securities are first sold in the primary financial market and then traded among investors in the
secondary financial market.
Initial Public Offering (IPO) - ✔✔✔The first public offering of a corporation's stock.
lagging indicators - ✔✔✔change after the economy changes;
Module 2 PASSED
A local start-up company just hit its five-year anniversary and is planning an initial public offering
sometime this year. In order to issue public stock, which market will the company use? - ✔✔✔Primary
market
When a company issues stock for the first time to raise capital, shares must initially be sold through a
primary market.
About a year ago, the short-term Treasury bill had 1.54% interest and the long-term Treasury note had
2.54% interest. This week, the 1-year Treasury bill has an interest rate of 3.13%, while the 10-year
Treasury note has an interest rate of 2.28%. What does this information indicate about the future
economy? - ✔✔✔It may indicate an economic downturn.
Since the long-term Treasury interest rate is lower than the short-term rate, it has an inverted yield
curve, which may indicate an economic downturn.
Auction market - ✔✔✔has a physical location where prices are determined by investors' willingness to
pay
(EX) New York Stock Exchange (NYSE)
bid-ask spread - ✔✔✔the difference between the bid price and the asked price
Capital Market - ✔✔✔market in which money is lent for periods longer than a year
coincident indicators - ✔✔✔collected, used, and analyzed as economic shifts happen
, analysts look at the big picture of the past changes to see future trends
examples: gross do(and personal income GDP increases, economy is strong and vice versa)
Corporate Bonds - ✔✔✔A debt instrument that is issued by a corporation in order to raise capital.
(EX) If Alphabet Inc. defaults and cannot repay the loan, the bondholders will have access to the
company's assets when they are liquidated during bankruptcy.
Dealer Market - ✔✔✔made up of multiple dealers that hold an inventory of securities and quote prices
(EX) NASDAQ
efficient market - ✔✔✔A market where prices reflect all available information.
In what way are coincident indicators useful? - ✔✔✔They analyzed during economic shifts to provide
information about the current state of the economy.
In which financial market are securities such as stocks and bonds are traded after their initial issuance? -
✔✔✔Secondary market
Financial securities are first sold in the primary financial market and then traded among investors in the
secondary financial market.
Initial Public Offering (IPO) - ✔✔✔The first public offering of a corporation's stock.
lagging indicators - ✔✔✔change after the economy changes;
