ECO 4223 MONEY AND BANKING William J. Luther TEST 1 with Complete Solutions

ECO 4223 MONEY AND BANKING William J. Luther TEST 1 with Complete Solutions Financial Markets include bonds, stocks, foreign exchange Financial Institutions include banks, insurance companies, mutual funds financial markets markets in which funds are transferred from people who have an excess of available funds to people who have a shortage security (financial instrument) is a claim on the issuers future income or assets bond a debt security that promises to make payments periodically for a specified period of time interest rate the cost of borrowing funds or the price paid for the rental of funds, usually expressed as a percentage of the amount borrowed common stock represents a share of ownership in a corporation that is a security that is a claim on the earnings and assets of the corporation