Question

1. Financial institutions in the U.S. economy Suppose Edison would like to use $4,000 of his savings to make a financial investment. One way of making a financial investment is to purchase stock or bonds from a private company. Suppose TouchTech, a hand-held computing firm, is selling stocks to raise money for a new lab-a practice known as finance. Buying a share of TouchTech stock would give Edison the firm. In the event that TouchTech runs into financial difficulty, will be paid first. Suppose Edison decides to buy 100 shares of TouchTech stock. Which of the following statements are correct? Check all that apply. TouchTech earns revenue when Edison purchases 100 shares, even if he purchases them from an existing shareholder. Expectations of a recession that will reduce economywide corporate profits will likely cause the value of Edison's shares to decline. An increase in the perceived profitability of TouchTech will likely cause the value of Edison's shares to rise. Alternatively, Edison could make a financial investment by purchasing bonds issued by the U.S. government. interest rate than a 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.

Answer 1

Blanks-

1) equity

2) a claim to partial ownership to

3) the bondholders

option (B) and (C) are correct

Blank - higher