1. Financial institutions in the U.S. economy Suppose Yakov would like to invest

Question

1. Financial institutions in the U.S. economy Suppose Yakov would like to invest $6,000 of his savings. One way of investing is to purchase stock or bonds from a private company. Suppose NanoSpeck, a biotechnology firm, is selling bonds to raise money for a new lab-a practice known as issued by NanoSpeck would give Yakov finance. Buying a bond ? the firm. In the event that NanoSpeck runs into financial difficulty, will be paid first. Suppose instead Yakov decides to buy 100 shares of NanoSpeck stock Which of the following statements are correct? Check all that apply. The Dow Jones Industrial Average is an example of a stock exchange where he can purchase NanoSpeck stock. NanoSpeck earns revenue when Yakov purchases 100 shares, even if he purchases them from an existing shareholder. An increase in the perceived profitability of NanoSpeck will likely cause the value of Yakov's shares to rise. Alternatively, Yakov could invest by purchasing bonds issued by the U.S. government. Assuming that everything else is equal, a U.S. government bond that matures 30 years from now most likely pays a U.S. government bond that matures 10 years from now. interest rate than a

Explanation / Answer

suppose nanospeck, a biotechnology firm...... as equity finance.

Buying a bond issued by.......... a claim to partial ownership in the firm.

In the event that nanospeck............ the bondholders will be paid first.

All the three statements are correct.

Assuming that everything.............. pays a higher interest rates

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