Business Org,money and banking
How are sole proprietorships formed?
They comprise the smallest form of business.
What is the stock market and how does it work?
Is a component of a free-market economy, allows companies o raise money by offering stock, shares and corporates band and allows investors to participate in the financial achievement s of the companies.
What is Credit Union?
A non profit service cooperative that accepts deposits, makes loans, and issues CD’s and offers checking accounts.
What does GDP stand for?
Gross Domestic Product
What is poverty?
Not having enough money to meet basic needs including food, clothing and shelter
Easy to start up, don’t require the approval of a co-owner Boss or other “high up”, Easy to get out of business
What are bonds?
A loaned that a bond purchaser, or bond holder makes to the bond issuer.
What saving and investing options are offered by banks?
Savings accounts, certificates of deposits, and money market accounts.
How is GDP calculated?
With Total market value of all final goods and services during a 12 month period for a country.
causes of poverty?
Education level and family wealth
What are the functions of Money?
They store value, unit of account, and medium of exchange
What is IPO
Initial price offering
how are Finance companies good?
They make loans directly to consumers banks, most visible of all financial intermediates, offer checking accounts, saving accounts, and CD’s
Difference between nominal and Real GDP?
Nominal- measures as current year prices
Real- adjusted for inflation
What causes unemployment?
Advancement in technology, discriminations gender, racial, and ethnic reasons.
What is the definition of Banking?
Operates to provide financial assistance to borrowers an allow cash transactions.
Ownership in a company?
Stock
How do pension funds work?
It’s a fund that collects periodic contributes from different firms employees.
The main causes of inflation?
Demand pull inflation, demand exceeding supply creating Shortages and driving up the prices, prices are pulled up by excessive demand.
What is the business cycle?
Expansion—>prices go up, unemployment goes down, GDP goes up, peak—-> GDP stops rising
What’s the difference between Franchisor and franchisee?
Franchisor- Actual owner of the business
Franchisee- investor who rents or leases the business model
What are mutual funds?
They are managed by professionals
How can life insurance companies help families?
One way to calculate GDP
Consumer Sector(households)+investment sector+ government sector+(exports-imports)
C+I+G(X-M)
What are the external shocks?
Oil prices, foreign wars, changes in investment, businesses are expanding, building more, changes in monetary policy