BU111 Study Guide - Final Guide: Complementary Good, Money Supply, Switching Barriers
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BU111 Full Course Notes
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Document Summary
Facilitate trade of stocks, bonds and other products in securities markets. Major source of short-term loans for business. Changes in the banking industry: deregulation (reduction of government power, changes in consumer demands, competition from foreign banks (foreign banks are allowed to do business in canada, so to respond. Canadian banks are trying to merge with one another. Manages economy and regulates aspects of chartered bank operations. Manages money supply by using 2 tools. Features (in terms of maturity dates, there are 3 types of bonds ) Secured (borrowers use collateral in the event of a non-payment) vs. Registered (names of holders are registered with the company) vs. Callable: issuer has the right to call the bonds in and pay them at any time. Serial: firm retired portions of the bond issue at different predetermined dates. Convertible: can be converted into common stock. Relationship between coupon rate & prevailing rates of interest. Return: fixed rate of return (often paid semi-annually)
