Leela Crosby And Alysha Shroff: Case Study

Leela Crosby and Alysha Shroff

I did the questions and Alysha did the vocabulary

ACTIVITY 1

Bond- a certificate issued by a government or a public company promising to repay borrowed money at a fixed rate of interest at a specified time.

Capital Gains- a profit from the sale of property or of an investment.

Capital Goods- goods that are used in producing other goods, rather than being bought by consumers.

Capital Loss- is the result of selling an investment at less than the purchase price or adjusted basis.

Common Stock- shares entitling their holder to dividends that vary in amount and may even be missed, depending on the fortunes of the company.

Dividend- a sum of money paid regularly (typically quarterly) by a company to its shareholders out of its profits (or reserves).

Equity- the value of the shares issued by a company.

Corporations have three methods available for raising new capital in the free enterprise system. retained earnings- putting money from the company’s profits back into the business after taxes and dividends, if any, have been paid borrowing- taking out loans or issuing bonds which are sold to investors equity financing- issuing new shares of stocks

Although we frequently hear the words “stocks and bonds” use together, these two types of securities differ significantly. A person who buys a bond essentially is lending money to the issuer of a bond (usually a company or a branch of government). The issuer of a bond promises to repay the amount of a loan at a specific time (called the date of the bond’s maturity). Between the time the loan is made and the date of maturity, the issuer also promises to pay the bondholder a specified amount of interest at specified