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The third exam will cover The Economy, Industries. Stocks, Securities Business.

ID: 2645829 • Letter: T

Question

The third exam will cover The Economy, Industries. Stocks, Securities Business. Averages. Indexes and Brokerage Firms Business Cycle, Coincident Indicators, Deficit. Discount Rate, Fiscal Policy. Gross Domestic Product. Lagging Indicators, Leading indicators. Monetary Policy. Bottom-Up Approach (Stock Pickers), Top-Down Approach Monopolies, Oligopolies, Pure Competition, Imperfect Competition Beta, General Divided Valuation Mode, Divided Growth Model, Equity Risk Premium, Earnings Valuation Model(P/E), Grow Companies, Growth Stock, Price-Earnings Ratio, Required Rate of Return, Risk-Free Rate, Valuation. Dividends on Stocks and Stock Splits Preferred Stocks and their characteristics Count on calculations dealing with: the Required Rate of Return. Price-earnings Ratio. Dividend Yield You will NOT have to fin the price of a stock using the dividend discount model The models are fair game for questions Averages & Indexes Dow Jones Industrial Average. Standard & Poors 500. Securities Business Primary and Secondary Markets. Investment Bankers. Best Effort Underwriting. Stand-by Underwriting Un-syndicated offering. Syndicate. Secondary Distributors Brokerage Firms Cash account vs Margin account. Full-Service Firm vs Discount Firm Trades Long. Market Order. Limit Order. Stop Order Short sale. Short Interest. Days to Cover. Short Squeeze. Short Against the Box Questions about current financial events us discussed in class and on CNBC during the first few minutes of class.

Explanation / Answer

ECONOMY

Economy is the rate of the country in terms of production or consumption of goods and services and the supply of Money.

INDUSTRIES is the economic activity concerned with the processing of raw material and manufacture of goods in factories.

STOCK are the goods kept in the premises of a shop and available for sale.

Securities means financing or investment instruments

AVERAGE INDEX is an indicator used in technical analysis as an objective for the strength or trend.

Brokerage company is a business whose main responsibility is to be an intermediary that puts buyers and sellers together for a transaction.

COINcident indicator is a metric which shows the current state of economic activity within a particular area.

Deficit is the amount by which something is too small.

Discount rate is the minimum rate set by US Federal Reserve for lending to other banks.

Fiscal Policy is the means by which govt adjusts its spending level and tax rates.

Lagging Indicator is a measurable economic factor that changes after the economy has already begun to follow a particular trend.

Monopoly is the Exclusive Possession or control of the supply of or trade in a commodity or service.

Pure competition is a market characterized by a number of independent sellers

Oligopoly is a state of limited competition in which a market is shared by a small number of producers or sellers.

PE ratio is Market price per share divided by earning per share,

Dividend on stock is income earned by the holder of stock issued by the company.

Preference share entitles the holder to a fixed dividend whose payment takes priority over of ordinary share.

According to Dividend growth model

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