BU111 Study Guide - Final Guide: Trust Company, Money Supply, Complementary Good
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BU111 Full Course Notes
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Document Summary
Five largest account for 90% of total bank assets. Bank act limits foreign controlled banks to 8% of total domestic bank assets. Major source of short-term loans for business. Facilitate trade of stocks, bonds and other products in securities markets. Manages economy and regulates aspects of chartered bank operations. Fixed rate f return (often paid semi-annually) Fixed term principal repaid at maturity. Determinants of bond value: what the coupon rate at bond issue. Coupon rate & prevailing rates of interest (relationship) Capital gain = face value purchase price. In bu111, always use face value of for bonds. Assumes you will hold the bond until maturity. Need to calculate what you made on an annual basis. %paidyou what gain capital +interest paidyou what madeyou what yieldx paid pricematurity totimepaid price - valueface valueface ratecoupon x- risk. Demand and supply of stock due to negative or positive perception/facts. Earning above or below expectations, rumors.
