1) Assets can be classified in 3 ways according to its liquidity. However, such
ID: 1092258 • Letter: 1
Question
1) Assets can be classified in 3 ways according to its liquidity. However, such assets do not include homes, jewelry, vehicles, etc. Why? (use three sentences maximum)
2) People often like to visit flea markets to look for unexpected opportunities. Flea markets also typically use cash. Explain why this is an example of the liquidity demand for money.
3) What would happen to the supply of money if a central bank purchased long-term government bonds held by the public?
4) If investors began to think the stock market is becoming less risky, how will this belief affect the demand for money? Would this more likely affect M1 or M2?
5) Suppose the interest rate on a two-year bond was higher than the interest rate on a one-year bond. What does the market believe will happen next year to one-year interest rates?
Explanation / Answer
here is no similar institution to the mortgage in the civil law, however a hypothec is a device to secure real rights against property. These real rights follow the property along with the ownership. In the common law a lien also remains on the property and it is not extinguished by alienation of the property; liens may be real or equitable.
Many jurisdictions levy a personal property tax, an annual tax on the privilege of owning or possessing personal property within the boundaries of the jurisdiction. Automobile and boat registration fees are a subset of this tax. Most household goods are exempt as long as they are kept or used within the household; the tax usually becomes a problem when the taxing authority discovers that expensive personal property like art is being regularly stored outside of the household.
The distinction between tangible and intangible personal property is also significant in some of the jurisdictions which impose sales taxes. In Canada, for example, provincial and federal sales taxes were imposed primarily on sales of tangible personal property whereas sales of intangibles tended to be exempt. The move to value added taxes, under which almost all transactions are taxable, has diminished the significance of the distinction.
Marital Property
All property obtained during the course of the marriage is marital property, regardless of who paid for it. The exception to this general rule is property received by one spouse as a gift or inheritance from a third party. As stated above, this property is considered non-marital property. Marital property can include real estate, bank accounts, stock, furniture, pensions and retirement assets, cars and other personal property.
Non-Marital Property
Non-Marital Property is any property obtained prior to the marriage remains the property of the party who owned it prior to the marriage and as such is non-marital property as long as it is not gifted or titled to the other spouse. Also, any property received by a spouse by gift or inheritance during the marriage from a third party remains the non-marital property of that spouse unless gifted or titled to the other spouse.
In the event that the marriage is dissolved and one spouse wants to claim particular items as his or her own, the person must have proof that the property in question belongs to him or her alone. A couple may acquire joint ownership in property brought to their marriage by either spouse through appropriate agreements or transfers of title.
Non-marital property is protected from the debts of the other spouse. Each party has the power to dispose of property owned by him or her alone, as if unmarried.
Making a Claim for Property Division
If you and your ex-spouse cannot agree on how to divide your property, the court will decide what is marital property and how much that property is worth. The court will also look at any marital debts when determining the value of the marital property.
The court will then determine each spouse
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