Finance Chapter 16

financing – Budgeting for marketing activities,obtaining the necessary funds needed for operations,and providing financial assistance to customers so they can purchase the business products and service.
Credit Union – Cooperative association which accepts savings deposits and makes small loans to its members.
Open Corporation – Created to any person who may wish to become a stockholder
Protective Covenants – As an example, limiting dividends
Investing – Committing resources today in hopes of earning profit in the future
– • Effective (true) annual rate (EAR)
Interest rate factor (1 + rf) – defines the exchange rate across time, and has units of "$ in one year/$ today".
Green Grocery recently issued 30-year $1,000 face value, 12% annual coupon bonds. The market discount rate for this bond is only 7%. What is the current price of this bond?
wyciąg bankowy – bank statement
Financial Institutions – Banks
Thrifts
Insurance Companies
Mutual Funds
What is an commercial bill – A commercial bill is similar to an overdraft in regards to the fact that it is a loan and it can come from a bank however, it is different as it can also be from a non-bank institution and it is also usually more than $100,000.
Financing/Credit Laws – Equal Credit Opportunity Act Prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age or dependency on public assistance. Lenders are required to make loans to all who are qualified regardless of the source of their income as long as it is legal and verifiable.18 Community Reinvestment Act: Ensures that financial institutions fulfill their responsibilities in servicing the credit needs of every member of the community. If they take money, they must loan money. It requires that lenders do business in the community where they derive their deposits/charters.
Limited liability partnership (LLP) – Permitted in most states, LLP partners are liable for their own acts of malpractice, but not for those of other partners. The LLP is taxed as a partnership and is frequently used by legal and accounting professionals.
lower monthly payments – principal advantage for a 30 year mortgage
Green Grоcery recently issued 30-yeаr $1,000 fаce vаlue, 12% annual cоupоn bonds. The market discount rate for this bond is only 7%. What is the current price of this bond?
Stop loss – Requires you to pay all costs up to a certain amount. very rare

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