Exam 1: Why Study Financial Markets and Institutions?

(I)Banks are financial intermediaries that accept deposits and make loans. (II)The term "banks" includes firms such as commercial banks,savings and loan associations,mutual savings banks,credit unions,insurance companies,and pension funds.

Markets in which funds are transferred from those who have excess funds available to those who have a shortage of available funds are called

________ was the stock market's worst one-day drop in history in the 1980s.

The price paid for the rental of borrowed funds (usually expressed as a percentage of the rental of $100 per year)is commonly referred to as the

What are financial intermediaries and what do they do?

Financial markets are what makes financial institutions work.

A security

A stronger dollar benefits ________ and hurts ________.

Compared to interest rates on long-term U.S.government bonds,interest rates on three-month Treasury bills fluctuate ________ and are ________ on average.

How has the stock market performed since 2000?

The price of one country's currency in terms of another's is called

From 1980 to early 1985 the dollar ________ in value,thereby benefiting American ________.

In recent years,financial markets have become more risky. However,only a limited number of tools (such as derivatives)are available to assist in managing this risk.

The Dow fell below 7,000 in 2009,only to start a bull market run,reaching new highs above ________ in 2013.

The stock market is important because

Banks,savings and loan associations,mutual savings banks,and credit unions

Money is anything accepted by anyone as payment for services or goods.

Holding everything else constant,as the dollar strengthens foreigners will buy more U.S.exports.

Why is the stock market so important to individuals,firms,and the economy?

In general,from 2001 through 2013,the dollar ________ in value relative to major foreign currencies.