Exam 16: The Financial System

Bonds are issued in various denominations-face values-usually between $100 and $2,500.

Out of the 50 largest banks in the world,________ are Canadian banks.

In order to join a credit union,you have to share something in common with other credit union members.

One of the Bank of Canada's most important responsibilities is to help facilitate the clearing of cheques.

Underwriting is the process used by insurance companies to determine whom to insure and what to charge.

Tom just bought a bond from United Pet Group.This bond is only backed by the financial reputation of the company.What type of bond did Tom buy?

Commercial banks obtain most of their funds from ________.

The ____ is a collection of financial markets in which previously issued securities are traded among investors.

Jeff wants to purchase a low-risk bond.Therefore,he should buy a government bond.

Which of the following financial institutions would invest the greatest percentage of its assets in common stocks and other long-term investments?

Explain how banks operate.

Explain the key players in the regulation of the Canadian financial system.

Explain the differences between the NYSE and the NASDAQ.

Deposit insurance shifts most of the financial risk of bank failures from depositors to ________.

As market interest rates rise,bond prices fall.

The Investment Industry Regulatory Organization of Canada purpose is to ensure that all equity trades comply with security trading rules.

Life insurance companies tend to invest excess funds in short-term securities,while pension funds tend to invest excess funds in long-term securities.

Two factors determine the price of a bond: ____ and ____.

Junk bonds pay about 70 percent more in interest than do investment-grade corporate bonds.

The treasury sells bonds that mature in 2,5,10,and 30 years from the date of issue.