Copyright 2023 . 1) ________ is the name given to the processes surrounding recognition of the principal-agent problem and ways to align agents with the interests of the principals. 10) Of the following, which is NOT an example of a financial intermediary? Financial intermediaries create a favorable atmosphere and conduct financial transactions for their customers. In addition, amid the complex system of multiple, imperfectly linked exchanges, new trading patterns have arisen that render the entire system fragile, raising serious worries among investors about the liquidity and value of their stocks. 3) Before the customer leaves, what questions would you ask her in order to properly place the order? Insurance companies are considered as financial intermediaries for several reasons. The first reason is that they receive funds from their clients for further investment. Many people use insurance companies as institutions in which they invest most of their savings. Banks utilize a significant portion of this money collected to lend it out to the people who need money for various purposes like implementing business ideas. Financial news source. This is an example of: A share of Microsoft stock would best be described as which of the following? 25 million Financial institutions that transform assets collect deposits (and payments for insurance policies) to raise funds that are then loaned to borrowers/spenders. The individual could also purchase a disability insurance policy to provide a specified income in the event that he is injured and cannot do his job. Provide one example of each type and describe how each functions as a financial intermediary. 17) Which of the following is NOT a financial intermediary? any food chain stores is --. In simple terms, it means giving the asset on hire or rent. A commercial bank refers to a financial institution that provides various financial solutions to the individual customers or small business clients. O b., A:Answer b) Manufacturing 2) Of the following activities, which is NOT likely to be an interaction between the financial manager and the marketing manager? The four fundamental characteristics that determine the value of a financial instrument are (1) The size of the payment that is promised; (2) When the promised payment is to be made; (3) the likelihood that the payment will be made; (4) The conditions under which the payment is to be made. Explain in your own words how AS OF dating (postdating) works. 9) ________ is a major disadvantage of the corporate form of business. How Banking Works, Types of Banks, and How To Choose the Best Bank for You. Insurance companies collect premiums for policies and provide policy benefits. Prospective investors should consult a legal, tax or financial professional in order to determine whether any investment product, strategy or service is appropriate for their particular In terms of information, collateral and monitoring, how might these higher rates be explained? 1) A ________ is a business that is owned entirely by an individual. Expert Solution Want to see the full answer? Matching An annuity is a contract that makes monthly payments as long as someone lives. | Invoice Date | Terms | Final Discount Date | Net Payment Date | What evidence, A:Various businesses are placing their confidence in 3PL companies to outsource information, Q:On the portfolio analysis, a firm The New York Stock Exchange (NYSE) originated as: Which of the following is not true of over-the-counter markets? 4) The problem of motivating one party to act in the best interest of another party is known as the ________. You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. A), A:Channel Intermediaries -The purpose of channel intermediaries are to move products to consumers or. During July, the general ledger account Cash shows deposits of$16,900, but the bank statement indicates that only $15,600 in deposits were received during the month. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers. Prospective investors should consult a legal, tax or financial professional in order to determine whether any investment product, strategy or service is appropriate for their particular circumstances. A) Mutual fund B) Bank C) Stock exchange D) Insurance company Answer: C C ) stock exchange Diff: 1 Question Status: Previous Edition 18) Which of the following is NOT a key service provided by the financial system? A)Stockbrokers. 2.Which entity below is a financial intermediary? O b. assesses its. Q:What is meant by good news? Kristian should go First week only $4.99! An example of secondary intermediaries is factoring companies. -SCM, The New York Stock Exchange (NYSE) is primarily As far as I know, Amazon Web Services is not a business-class solution. A bank B. 2) What was she clear or unclear about ? Most financial instruments are complex in the sense that many possible contingencies are identified and both buyer and seller want to avoid problems that can arise from unforeseen events. d. The value of his option contract will increase as the actual price of the ABC stock (the underlying instrument) rises and exceeds $10 per share. O a.Focused, A:The question is related to Market strategy. Bella's share of 12) Which of the following is true of a dealer market? A country's economic growth is linked to financial market development. 14) Which of the following is NOT an activity of a financial institution or market? Manufacturing Log in for more information. The obtaining of a car loan is a primary market transaction since the loan represents a newly-issued instrument by the bank. Asked If actual wheat prices do increase the baker will lose money on the actual baking operations but these losses will be offset by the profits he will earn on the wheat futures contract. Can a financial instrument be bought and sold in both a primary and secondary financial market? The baker would really like to have this contract but he realizes that fluctuating input prices (specifically wheat) could result in significant losses. Financial news source.c. FALSE, Name the three critical functions that information systems may play for a commercial firm, as well as the three fundamental reasons for all IT-based business applications rthday. For instance, they have access to economies of scale to expertly evaluate the credit profile of potential borrowers and keep records and profiles cost-effectively. When providing credit cards to customers, banks have the ability to obtain information at the time of application and based on this information they decide to issue or not issue the card. Alternatively, it can issue $10 million in bonds. A financial intermediary is involved indirectly in a financial transaction. In a nutshell, it is distinguished as bank and nonbank intermediaries. a business organization owned by two or more persons who agree on a specific division of responsibilities and profits C Some of the examples are commercial banks, stock exchanges, mutual fund companies, insurance companies, credit unions, non-banking finance companies (NBFCs), pension funds, building societies, financial advisors, investment bankers, escrow companies. If all the activites of Business(order,Delivery,payment) is offline then it is not E-commerce Financial news source. The paradox of leverage occurs when all financial institutions try to deleverage at once. He needs to hire a second Chiropractor, a Massage Therapist, a Physical Therapist, and a Medical Secretary. A Capital maintenance approach Education Level What evidence is there that the transaction costs involved with the buying and selling of stocks is low? c. Single entry method When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. A stock exchange, 2.Which entity below is a financial intermediary? It gives you access to critical resources. A person or business that is prepared and willing to purchase a security for their own *Production*: 7,000 units finished and transferred out; 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs. Financial instruments are different from money because they: Juan purchases automobile insurance; the insurance contract is a: A bank is a financial intermediary. b. Which of the following is not a financial intermediary? O b. money and other valuables belonging to an individual or business Jozeal. The certificate of deposit, the balances in her mutual fund and pension are instruments that are serving primarily as stores of value. Moreover, it can be government or private entities. bachelors degree, medical school degree 4) The common objective of borrowing and lending is to ________. 1) A financial instrument is a written legal obligation; (2) A financial instrument transfers something of value to another party; (3) A financial instrument specifies some future date for this transfer to occur; and (4) A financial instrument specifies certain conditions under which payment will be made. 10) The sale of "used" securities,where the financial asset is being traded from one individual to another and the proceeds do not go to the original issuer of the security, is said to take place in the ________ market. The answer is yes and highly likely. You are free to use this image on your website, templates, etc., Please provide us with an attribution link. A:A franchise business plan, basically, merges constituents of both franchisee & franchisor. 5) Which of the following is NOT a function of a financial intermediary in the lending/borrowing process? 10) The form of business organization in the United States that has the greatest amount of capital is ________. 3) A firm's stock price most closely reflects which of the following? Q:32) 11) Of the following, which is NOT an activity engaged in by a financial intermediary? There were no bank debit or credit memoranda, and no errors were made by either the bank or Downs Company. d. Insurance company. Select one: This will prove counterproductive as falling asset prices will mean more losses, diminishing their net worth still more, raising leverage and making the assets they hold seem riskier, compelling further sales, and so on. For July: The program covers part of the ***Instructions*** 9. Expert answered|mer888|Points 175| Log in for more information. At some later time, however, the Federal Reserve may decide to sell the bond and this transaction would be a secondary market transaction since the instrument already exists. If, Q:a. Another common example is an insurance policy that transfers risk from the insured (a homeowner) to the insurer (the insurance company). At the same time, financial intermediaries pool risk by spreading funds across a diverse range of investments and loans. In either case by bypassing college he has left himself with fewer options than he might otherwise have. LifeTyme Publishers Inc. collects 30% of its sales on account in the month of the sale and 70% in the month following the sale. Financial intermediaries typically offer a wide range of services and products, such as deposit accounts, loans, and retirement plans, which can help individuals achieve their financial goals. A commercial bank An insurance company A pension fund A stock exchange 2.Which entity below is a financial This puts otherwise idle resources to use, increasing an economy's output. Thank you for your time and have a blessed day. b. Which of the following does not involve a financial intermediary? CFA Institute Does Not Endorse, Promote, Or Warrant The Accuracy Or Quality Of WallStreetMojo. It transferred the risk of volatile wheat prices from the baker, who otherwise wouldn't accept the opportunity to provide bread at a guaranteed price for a year, to someone who was more willing to accept this risk. Explain with example. An investment bank O Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus, **Find the sum or difference. They provide a wide array of products and services to cater to the diverse needs of the market participants. New York Stock Exchange B. 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