150 points

 

Due the Day of the Final Exam

 

You are hypothetically going to buy $10,000 worth of stock, including commission ($9800-$9900 without commission) at the closing price on Thursday May 11th and sell your shares at the closing price on Wednesday May 24th.

 

You can use the sheets I gave you to make your stock purchase, and track the price per share of your stocks and the overall value of your investment.

 

Your project should be on a poster board of some kind.

It should have three graphs showing the price per share of your stocks for each day you owned the stock.

The fourth graph should show the overall value of your investment each day you owned the stock.

Your project should also have four written summaries, one for each of the stocks you owned, and one for your overall value.

Your summaries should include things like the reason you bought stock in that company, the value of the stock when you bought it, the highest point it reached, the lowest point it reached, and how much money you made or lost on it.

Your summary for the overall value should include things like the purchase price of your overall investment, how much money you made or lost overall, and the highest point and lowest point your investment reached.

 

Oral Report

150 points

 

Your oral report should be based on your summaries that you wrote talking about each stock and your overall investment.  It should last from 1 to 2 minutes.

 

 

Read pp. 328-333.  Answer in complete sentences.

 

1. What are equities?

2. What does the Efficient Market Hypothesis say?

3. What is portfolio diversification and why is it important?

4. What does a stockbroker do?

5. What are securities exchanges?

6. Graphic organizer showing four characteristics of the New York Stock Exchange.

7. How is the AMEX different from the NYSE?

8. What are regional stock exchanges?

9. What are global stock exchanges?

10. What is the OTC market?

11. How do people invest in NASDAQ stocks?

12. What is the Dow Jones Industrial Average?

13. What should you focus on when looking at the Dow Jones Industrial Average?

14. What is the Standards & Poor 500, and how is it different from the DJIA?

15. How is a bear market different from a bull market?

16. How is a spot market different from a futures contract?

17. How do people invest in futures markets?

18. How is a call option different from a put option?

 

Read pp. 324-326.  Answer in complete sentences.

 

1. How are treasury notes different from treasury bonds?

2. Why are treasury notes and bonds popular with investors?

3. Why don't some people want to buy treasury notes and bonds?

4. What are T-bills?

5. How is an IRA different from a Roth IRA?

6. How is a capital market different from a money market?

7. What is the difference between primary and secondary markets?

 

Read pp. 320-323.  Answer in complete sentences.

 

1. How do governments borrow money?

2. Describe each of the three components of a bond?

3. What established the final price of bonds?

4. What is the current yield of a bond?

5. If a bond is rated AAA, what does that mean?

6. If a bond is rated D, what does that mean?

7. How does the rating of a bond affect its price?

8. What is a certificate of deposit?

9. Why are CD's attractive to small investors?

10. When you purchase a corporate bond, what are you doing?

11. What are municipal bonds, and what is the big advantage of purchasing them?

12. What are savings bonds?

13. How is the interest on a savings bond paid?

14. Why are savings bonds attractive to all investors?

 

Read pp. 318-320.  Answer in complete sentences.

 

1. What is risk?

2. What is the relationship between risk and return?

3. What should your first consideration be when investing?

4. If you are saving for retirement, what kind of investment do you want to make?

5. What type of investment should you make if you need the money sooner?

6. How does an investor's goals affect his or her investment?

7. What are two rules that many investors follow?

8. Why is consistency important in investment?

9. What are 401k plans?

10. Why is it beneficial to use a 401k plan?

11. When are returns on 401k plans the highest?

12. Why are 401k plans popular?

 

Read pp. 313-316.  Answer in complete sentences.

 

1. What is the difference between saving and savings?

2. How are savings beneficial to the economy?

3. What is a certificate of deposit?

4. What are financial assets?

5. What do financial intermediaries do?

6. How is the flow of funds that go from savers to borrowers circular?

7. What are non bank financial institutions?

8. How are finance companies different from banks?

9. What are bill consolidation loans?

10. What do Life Insurance Companies do with their excess funds?

11. What is a mutual fund?

12. How do people who invest in mutual funds make money?

13. What are pension funds?

14. What are REIT's?

 

Honors Question

 

Pg. 316 Sec. Assessment #6.

 

Read pp. 304-305.  Answer in complete sentences.

 

1. What banking crisis took place in the 1980's?

2. Graphic Organizer showing four reasons the Savings & Loan (S&L) crisis took place.

3. What can the FDIC do if a bank is in danger of collapse?

4. Why are forced bank sales or liquidations kept secret?

5. Why don't depositors have to worry about bank failures?

6. Why do banks sometimes fail?

7. What made the banking industry more stable in the 1990's?

8. What were two trends in banking that emerged in the 1990's?

 

Honors Assignment (20 pts.)

pg. 308 Identifying Key Terms.  Write the letter of the correct answer for each one.

 

Read pp. 303-304.  Answer in complete sentences.

 

1. What are commercial banks?

2. What are DDA's?

3. How were thrift institutions different from commercial banks?

4. What were mutual savings banks and how did they change?

5. Why were mutual savings banks established?

6. Why didn't savings banks become popular nationwide?

7. What are NOW accounts?

8. What are Savings & Loans?

9. What are share draft accounts and why were they introduced?

10. Why were financial institutions closely regulated between the 1930's and 1970's?

11. What was Deregulation and why was it instituted?

12. Graphic Organizer showing three ways deregulation reduced differences between types of banks.

 

Honors Question

13. Pg. 308 Thinking Critically #1

 

Read pp. 300-302.  Answer in complete sentences.

 

1. What two needs do banks fulfill?

2. What did the 1863 National Banking Act do?

3. What finally led the U.S. Government to reform the Banking System?

4. What was the Federal Reserve System?

5. What banks were part of the FED?

6. Who owns the Federal Reserve, and who controls it?

7. What are Federal Reserve Notes?

8. What problems were there in banking  from 1880-1929?

9. Why did banks fail during the Great Depression?

10. What did FDR do to try to solve the banking problems?

11. What did the Glass Steagall Act of 1933 do?

12. What was the FDIC, and why was it created?

13. How has the role of the FDIC expanded in recent years?

 

HONORS QUESTION

 

14. Why was it necessary for the U.S. Government to create the FDIC?  What would have happened had it not been created?

 

Read pp. 295-298.  Answer in complete sentences.

 

1. What were Gold and Silver Certificates?

2. What were Treasury Coin Notes?

3. What was the Gold Standard?

4. What were two advantages of the Gold Standard?

5. What were four disadvantages of the Gold Standard?

6. What ended the use of the Gold Standard in the U.S.?

7. What did the 1934 Gold Reserve Act do?

8. What monetary system replaced the Gold Standard in 1934?

9. How is the U.S. Money Supply a managed one?

10. How has the Federal Reserve made management of the money supply easier?

11. What are the tangible and intangible components of the money supply?

12. What are four characteristics of modern money?

 

Honors Question

 

Some people say that the U.S. should go back on the Gold Standard.  Do you agree or disagree?  Explain why or why not.