AFM 121- Final Exam Guide - Comprehensive Notes for the exam ( 67 pages long!)

• School: University of Waterloo
• Department: Accounting & Financial Management
• Course: AFM121
• Professor: John D' Amato

Document Summary

Financial markets transfer wealth from those who have extra wealth to those who need capital: drive economic growth by transforming savings into investments, movement of funds, three components of wealth transfer, financial instruments, financial markets, financial intermediaries. Purchases of financial assets (bonds, stocks, treasury bills) Issuers of financial capital invest funds into real assets to generate wealth. Governments and financial institutions issue financial assets and receive funds to invest the funds. Investors of the financial capital generate a return: capital tends to flow towards attractive economic environments, capital flows in and out of countries in response to various factors such as, the political environment. Stability of the government: provinces can destabilize the nation if they wish to separate, economic trends, other countries" interest in canada. Fiscal policy: determined by the prime minister, where the money gets spent (e. g. hospital and roads), and taxation, monetary policy, determined by the bank of canada, very steady inflation policy, safe place to put money.