STUDY GUIDE EXAM 1

1.What are the advantages and disadvantages of proprietorships, partnerships and corporations?

2.How can you reduce stockholder and manager conflicts?

3.How can you reduce stockholder and bondholder conflicts?

4.What is the goal of the firm?

5.What is the difference between money and capital markets, spot and futures markets?

6.What are the different types of financial institutions and what do they do?

7.What is the difference between an auction market and a dealer market?

8.What is the difference between the NYSE and the NASDAQ?

9.What is the difference between a primary and secondary market transaction?

10.What is meant by stock market efficiency?

11.Why are ratios useful?

12.What are the limitations and problems regarding ratios?

13.What is worth more, a dollar today or tomorrow?

14.Which will be higher, the future value of an ordinary annuity or an annuity due?