FIN 370 Week 2 Individual Assignment - Chapter Study Questions

FIN 370 Week 2 Individual Assignment - Chapter Study Questions

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Chapter Study Questions 1 Week 2 Chapter Study Questions University of Phoenix FIN/370 – Finance for Business
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Chapter Study Questions 2 Week 2 Chapter Study Questions Chapter 14, Study Question 14-1 What are financial markets? Financial markets, “… are institutions and procedures that facilitate transactions in all types of financial claims” What function do they perform? “Financial markets exist in order to allocate the supply of savings in the economy to the demanders of those savings” (Keown et al., 2005, p. 476). How would an economy be worse off without them? “…wealth of the economy would be less without the financial markets. The rate of capital formation would not be as high if financial markets did not exist” (Keown et al., 2005, p. 476). Essentially, financial markets aid the rate of capital in the economy. Chapter 14, Study Question 14-3 Money market, “… refers to all institutions and procedures that provide for transactions in short-term debt instruments generally issued by borrowers with very high credit ratings” (Keown et al., 2005, p. 486). Debt instruments such as, U.S. Treasury bills, commercial paper, bankers’ acceptances, federal agency securities, and negotiable certificates of deposit are issued and
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FIN 370 Week 2 Individual Assignment - Chapter Study Questions

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