Name at least three economic variables that the affect the stock market and describe their effects
What will be an ideal response?
Answer: Inflation: high inflation increases the rate at which cash flows from investments are discounted and therefore tends to lower their value. Inflation is also a major component of interest rates. Interest rates: in general rising interest have a negative effect on security prices and falling interest rates a positive effect.
Money supply: moderate growth in the money supply has a positive effect, but rapid growth can lead to inflation and higher interest rates, which would be negative. A contracting money supply is typical of recessions and depresses stock prices.
Exchange rates: a relatively weak dollar favors industries that are major exporters such as agriculture and construction equipment. A strong dollar favors importers and also reduces the possibility of inflation because imported goods are cheaper in dollar terms.
(Student answers will vary.)
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Sarah receives a $15,000 scholarship from City University. The university specifies that $8,000 is for tuition, books, supplies, and equipment for classes. The other $7,000 is for room and board. Sarah works ten hours per week as a grader, for which she is paid $7,500 for the year. Of the total amount received, Sarah must include the following amount in gross income
A. $7,000. B. $14,500. C. $7,500. D. $22,500.
A company's board of directors analyzes financial statements to improve operating performance and evaluate the performance of individual entry-level employees.
Answer the following statement true (T) or false (F)
Blogs should provide fresh content regularly
Indicate whether the statement is true or false
Which of the following best illustrates how a firm can use a symbol to make an intangible product more tangible?
A. McDonald's arches B. Mercedes Benz emblem C. Nike swoosh D. Traveler's Insurance umbrella E. Arrows on Wrigley gum packages