COPY: Master the World of Finance

WorthOcean avatar
By WorthOcean

Quiz

Flashcards

9 Questions

What is the main difference between finance and economics?

What are the three main areas of quantitative or mathematical finance?

What is the main focus of corporate finance?

What is the main focus of investment management?

What is behavioral finance?

What is the main focus of public finance?

What is the main focus of financial mathematics?

What is experimental finance?

When was the New York Stock Exchange founded?

Summary

Finance: A Summary

  • Finance is the study and discipline of money, currency and capital assets.

  • It is related to economics but bridges the gap between economic principles and financial systems.

  • The financial system is divided into personal, corporate, and public finance.

  • Assets are bought, sold, or traded as financial instruments in financial systems.

  • A broad range of subfields exists within finance, including asset, money, risk, and investment management.

  • The early history of finance parallels the early history of money, which is prehistoric.

  • Finance emerged as a distinct academic discipline, separate from economics, in the middle of the 20th century.

  • Personal finance involves paying for education, financing durable goods, buying insurance, investing, and saving for retirement.

  • Corporate finance deals with the actions that managers take to increase the value of the firm to the shareholders.

  • Public finance describes finance related to sovereign states, sub-national entities, and related public entities or agencies.

  • Investment management is the professional asset management of various securities, typically shares and bonds, in order to meet specified investment goals for the benefit of investors.

  • Quantitative finance includes finance activities where a sophisticated mathematical model is required and overlaps several other areas of finance.Overview of Finance

  • Financial mathematics is the application of mathematics to financial markets and models.

  • The field of financial mathematics is focused on modeling derivatives, interest rate and credit risk modeling, insurance mathematics, and quantitative portfolio management.

  • The field is referred to as quantitative or mathematical finance and comprises primarily of three areas: asset pricing, corporate finance, and financial intermediation.

  • The main mathematical tools and techniques are derivatives pricing, risk and portfolio management, and computational finance.

  • Experimental finance aims to experimentally observe and analyze agents' behavior and the resulting characteristics of trading flows, information diffusion, and aggregation, price setting mechanisms, and returns processes.

  • Behavioral finance studies how the psychology of investors or managers affects financial decisions and markets.

  • Behavioral finance includes topics such as biases, heuristics, and framing effects.

  • Quantum finance is an interdisciplinary research field, applying theories and methods developed by quantum physicists and economists to solve problems in finance.

  • The origin of finance can be traced to the start of civilization, with evidence dating back to around 3000 BC.

  • The Babylonians were among the first to charge interest, and Jews were not allowed to take interest from other Jews.

  • By 1200 BC, cowrie shells were used as a form of money in China, and by 640 BC, the Lydians had started to use coin money.

  • The use of coins as a means of representing money began in the years between 600 and 570 BCE, and cities under the Greek empire started to mint their own coins.

  • The London Stock Exchange was founded in 1773 and the New York Stock Exchange was founded in 1793.

Description

Test your knowledge of finance with this comprehensive quiz covering a broad range of topics, from the history of money to modern-day financial systems. Brush up on your understanding of personal, corporate, and public finance, as well as the subfields of asset, money, risk, and investment management. Challenge yourself with questions on financial mathematics, experimental finance, behavioral finance, and even quantum finance. Take this quiz to see how well you know the ins and outs of the world of finance.

Make Your Own Quiz

Transform your notes into a shareable quiz, with AI.

Get started for free