BU283 Study Guide - Final Guide: Dividend Discount Model, Initial Public Offering, Fixed-Rate Mortgage
Document Summary
There are four perspectives: academic finance, business finance, careers in finance, personal finance. Financial markets are the place in which suppliers and users of capital interact. Include shares, bonds, and securities that span national borders: they exist physically and virtually like the exchange markets. Money market is for securities that mature in less than 1 year. Capital market is for securities that mature in more than 1 year. The financial system transfers money from suppliers to users: usually transact through intermediaries. Intermediaries include commercial banks, investment banks, and funds. In a money market, the securities: are short term, are highly liquid (easy to sell, mature in less than 1 year from their issue date. Investors use the money markets as an interim investment that provides a higher return than cash. Individuals participate in the money market when they buy units in money market mutual funds (mmmfs) The government funds a large portion of the national debt by issuing t-bills.
