Advanced Financial Literacy Unit #1 Test Review Activity

Set of institutions, such as banks, insurance companies, and stock exchanges, that permit the exchange of funds.

• 4. Economic systems

• 1. Investment markets

• 1. Financial systems

• Asset Classes

Individuals or groups with capital to invest, who expect to earn returns.

• Entrepreneurs

• Investors

• Laborers

• Intermediaries

“Middlemen” who facilitate financial activity.

• Entrepreneur

• Investor

• Rating Agency

• Intermediary

Entrepreneurs and/or project owners who have ideas but need capital to produce future cash flows.

• Producers

• Investor

• Rating Agency

• Intermediary

The market for raising capital, where money flows to the producer from the investor.

• Primary market

• Secondary market

• commercial bank

• Tertiary market

Check ALL that apply regarding secondary markets?

• Securities can be exchanged between investors as much as possible

• Provides investors with a flexible time horizon.

• Prices are predetermined.

• Investors gain or lose profits according to market conditions.

Financial intermediaries who accept deposits from savers, and use these deposits to make loans to businesses and individuals.

• Rating agencies

• Commercial banks

• primary markets

• secondary markets

The statement below that would BEST define investing is

• 2. keeping what money you put away but adding to it with interest.

• 1. money bet on short-term price fluctuations.

• 1. putting money to work for a period of time in some sort of project or undertaking in order to generate positive returns.

• 1. placing it all in crypto.

____________________ serve mainly as a facilitator and the provider and user of capital face each other.

• Investment banks

• Rating agencies

• Commercial banks

• Accounting firms

The period of time one expects to hold an investment until they need the money back.

• Time horizon

• Risk tolerance

• Maturity date

• Dividend date