Part One. Fill in blanks 2 points each.
1. The International banking agency created to foster economic development kin poorer nations is known as the ________________Bank.
2. The International banking agency established to stabilize international exchange rates and currency is the ___________________________Fund.
3. The ____________supply is the amount of money the Federal Reserve makes available for people and businesses to buy goods and services.
4. _____________________is the outdated system of exchange whereby trading of goods and services are traded for other goods and services – like an apple for the teacher.
5. The __________________rate is the interest rate the Federal Reserve charges to banks for money borrowed from the Federal Reserve.
6. The ________________________date is the exact date a bond must pay back the investor who purchased the bond.
7. The positive difference between what you purchase a stock for and the higher price at what you later sell the stock for is called ________________gain.
8. ________________is the term used for expected return on investment. (Ch. 19)
9. A ________________________bond allows the issuer to pay off a bond before the date it is due.
10. When a company makes profits, it may issue cash ____________________to stockholders.
11. The government agency that regulates stock markets is the ____________________________.
12. _______________________is the name of the electronic network that connects member stockbrokers so they can buy and sell stock for their clients electronically rather than in person.
13. The first public offering of a company’s stock is called an ___________________________________.
14. ______________________law is the body of law that comes from decisions handed down by Courts.
15. ________________law proceedings cover noncriminal acts.
16. ____________________________, in tort law, describes conduct that UNITENTIONALLY causes harm or injury.
17. ________________________warranties are specific representations made by sellers which buyers rely upon when purchasing goods.
18. ______________________laws are designed to insure a competitive business environment and promote fair business practices.
19. Which law allows removal of potentially dangerous toys from sale in stores? ________________________________________
Part Two: True or False 2 points each
20. ______________”Buying stock on margin” refers to purchase of stock by a broker on the floor of the NYSE.
21. _____________Junk bonds are high risk bonds.
22. _____________Appeals courts are bound by the precedents established by trial courts.
23. _____________The United States has more lawyers per capita than any other country in the world
24. _____________Foreign companies are not allowed to file patent applications in the United States.
25. _____________According to your text Patent “trolls” are inventors who create new products for the public good.
26. _____________If a writing is created by someone pertaining to a work assignment and written during the regular hours of his or her work, the copyright on such work belongs to the employee.
27. _____________Trademarks permanently expire 70 years after creation.
28. ______________An internet retailer can be required to collect sales tax on goods for a state government even if the retailer does not have a presence in that state.
29. ______________Bond owners are creditors to the company that issued the bonds.
Part Two: Short Answer 7 points each
A. Your friend John knows very little about banks and money. He tells you he is afraid to put money in the bank because the bank might fail, He would rather keep cash at home in a drawer. What government agency would you describe to him to calm his fear that he will not be able to get money out of the bank. What does that agency do?
B. Why would a new investor in the stock market want to buy mutual funds rather than stocks or bonds directly?
C. Explain the importance of the daily Dow Jones Industrial Average.
D. Your friend Sally has written a song , including lyrics and music. She asks you what sort of intellectual property is available to her to protect her rights in the song. What steps should she take to protect her interest?
E. Mary orally offers to clean John’s apartment for 75.00 per week. John orally accepts. Both Mary and John are adults and mentally competent. Is there a binding contract? Discuss whether all six elements of a contract are present?
F. If a friend were to open a restaurant business, which types of insurance listed in the charts on page 606-607 of your text would you suggest the restaurant obtain? Why?
