BUSFIN Exam #2 Review - Chapter 1

Market where newly issued securities (stocks or bonds) are first offered to investors.

Market where existing securities are traded between investors.

Market for short-term debt securities.

Market for long-term debt securities and equity.

Foreign exchange rates, fluctuating values of one currency compared to another.

Interest rate not adjusted for inflation.

Interest rate adjusted for inflation.

Risk that an asset cannot be quickly converted into cash without significant loss of value.

Debt securities issued by government-sponsored enterprises (GSEs) or other agencies.

Rate of return on an investment with no risk of default, usually government bonds.

Risk that a borrower will fail to make interest or principal payments.

Bond trading above its face value.

Bond trading below its face value.

Implied yield of a bond if held till maturity.

Annual coupon payments divided by current market price.

The face value of a bond, repaid at maturity.

Average time it takes to recover the invested money.

Difference between a floating rate bond and a benchmark interest rate.

Payment made to shareholders from company profits.

Profit made by selling an asset for more than its purchase price.

Price-to-earnings ratio, measuring a company's valuation.

Investment pools managed by professionals, investing in a portfolio of assets.

Exchange-traded funds, investments tracking indexes or sectors.

Measure the performance of a group of stocks, like the S&P 500.

Markets where corporations issue new securities to raise capital.

Financial intermediaries arranging primary market transactions.

Depository institutions focused on loans and deposits.

Markets where existing securities are traded.

Simultaneous buying and selling of a security during a period.

Markets for short-term debt securities with maturities under a year.

Markets for long-term debt and equity securities.

Short-term US government obligations.

Short-term funds transferred between financial institutions.

Security sales with an agreement to reverse the transaction.

Short-term, unsecured promissory notes issued by companies.

Bank-issued time deposits that are negotiable.

Bank-guaranteed time drafts for goods.

Long-term US Treasury obligations used for national debt finance.

Long-term debt securities backed by assets within a pool.

Long-term debt of state and local governments.