Management and Organizational Studies 1023A/B Study Guide - Final Guide: Ontario Securities Commission, Money Market, Subordinated Debt

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Barry Hawn

Document Summary

Finance: the study of how and under what terms savings (money) are. Investment can be viewed in two ways: present value, future value, present value= future value/ (1+ forgone interest e. g. 0. 12) n (number of compounding periods) Insert figure 1-3: debt instruments issued by corporations, commercial paper, bankers acceptance, corporate bonds, debentures: unsecured debt. Intermediation: bringing the two parties (lenders and borrowers) together: someone borrowing from friends and relatives obtains funds directly, someone borrowing from individuals who have loaned their savings (deposited them into) a bank obtains funds indirectly. Insert figure 1-4: first channel: direct intermediation, where the lender provides money directly to the ultimate borrower without any help from a specialist. This is a non market transaction: second channel: direct intermediation but someone is needed because no one the individual can lend the amount needed or because the borrower is not aware of available lenders.