Principles of Economics 2e
2nd Edition
ISBN: 9781947172364
Author: Steven A. Greenlaw; David Shapiro
Publisher: OpenStax
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Textbook Question
Chapter 17, Problem 29CTQ
If you owned a small firm that had become somewhat established, but you needed a surge of financial capital to can‘t out a major expansion, would you prefer to raise the funds through borrowing or by issuing stock? Explain your choice.
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Evaluate each of the following statements and say whether it describes a loan, a bond, and/or a stock.
Chapter 17 Solutions
Principles of Economics 2e
Ch. 17 - Answer these three questions about early-stage...Ch. 17 - From a firms point of view, how is a bond similar...Ch. 17 - Calculate the equity each of these people has in...Ch. 17 - Which has a higher average return over time:...Ch. 17 - Investors sometimes fear that a high-risk...Ch. 17 - What is the total amount of interest from a 5,000...Ch. 17 - If you receive 500 in simple interest on a loan...Ch. 17 - You open a 5-year CD for 1,000 that pays 2...Ch. 17 - What are the- most common ways for start-up firms...Ch. 17 - Why can firms not just use their own profits for...
Ch. 17 - Why are banks more willing to lend to...Ch. 17 - What is a bond?Ch. 17 - What does a share of stock represent?Ch. 17 - When do firms receive money from a stock sale in...Ch. 17 - What is a dividend?Ch. 17 - What is a capital gain?Ch. 17 - What is the difference between a private company...Ch. 17 - How do the shareholders who own a company choose...Ch. 17 - Why are banks called financial intermediaries?Ch. 17 - Name several different kinds of bank account. How...Ch. 17 - Why are bonds somewhat risky to buy, even though...Ch. 17 - Why should a financial investor care about...Ch. 17 - What is a mutual fund?Ch. 17 - What is an index fund?Ch. 17 - How is buying a house to live in a type of...Ch. 17 - Why is it hand to forecast future movements in...Ch. 17 - What are the two key choices U.S. citizens need to...Ch. 17 - Is investing in housing always a very safe...Ch. 17 - If you owned a small firm that had become somewhat...Ch. 17 - Explain how a company can fail when the safeguards...Ch. 17 - What are some reasons why the investment strategy...Ch. 17 - Explain why a financial investor in stocks cannot...Ch. 17 - Explain what happens in an economy when the...Ch. 17 - You and your friend have opened an account on...Ch. 17 - How do bank failures cause the economy to go into...Ch. 17 - The Darkroom Windowshade Company has 100,000...Ch. 17 - Imagine that a local water company issued 10,000...Ch. 17 - Suppose Ford Motor Company issues a five year bond...Ch. 17 - How much money do you have to put into a bank...Ch. 17 - Many retirement funds charge an administrative fee...
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Similar questions
- What will be the total investment cost of shares? Show appropriate calculations.arrow_forwardAnswer the attached questionarrow_forwardWhat is a bond? A certificate representing a loan from an investor to a corporation or government entity that makes fixed payments for a set time and eventually pays back the loan in full. A certificate of ownership in a corporation with the right to a percentage of the earnings. A payment for an investor to a corporation for the rights to future profits. A group of stocks sold together for a set price.arrow_forward
- In which two markets can you buy stock? Compare and contrast these two markets. What is an IPO?arrow_forwardHow would a financial manager's role in a corporation increase/decrease if the rate of inflation in the economy was increasing. Why? How? What to do?arrow_forwardFind out change in stock if closing stock is $60,000 and opening stock is $34,000?arrow_forward
- Which of the following is a benefit of using financial investment to raise financial capital? there is an impact on the ownership of the firm it is accessible to start ups there is added pressure for the business to succeed it is the most sraightforward approacharrow_forwardGive your opinion on the current situation of stock market right now. Would it be profitable to invest in stocks?arrow_forwardWhy is ownership of a corporation the easiest to transfer?arrow_forward
- How important is CFO in a rural bank? What he can do that others cannot?arrow_forwardDescribe the capital stock of your university in terms of tangible and intangible concepts. How would you go about measuring its value?arrow_forwardCreate a useful plan for how a firm may raise finantial capital.arrow_forward
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