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45 Cards in this Set
- Front
- Back
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What are two advantages of a sole proprietorship?
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easy start up
flexible hours |
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what are two disadvantages to a sole proprietorship?
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limited life
unlimited liability |
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what are two advantages of a partnership?
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more capital
share responsibility |
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waht are two disadvantages to a partnership?
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unlimited liability
limited life |
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waht are two advantages of a corporation?
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unlimited life
increase in capital |
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what are two disadvantages to a corporation?
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costly and time consuming start up
double taxation |
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what are 3 reasons why corprations need funds?
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pay dbts
expand the business increase inventory |
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what are 3 sources of funds for corporations?
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debt financing
equity financing retained earnings |
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recieves dividends last
has voting rights |
common stock
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recieves dividens first
no voting rights |
preffered stock
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What is a charter
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a licence to do business issued to the corporation by the federal or state gov
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what are 4 things included in a charter
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name of business, adress, purpose, numbers of shares of stock
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what form of business is subject to double taxation
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corporation
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what is double taxation
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when dividends are recieved they are taxed as corporate profits then when distributed are taxed as individual incomes
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What are the 3 major stock exchanges
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NYSE(New York Stock Exchange)
Nasdaq(national association of security dealers automated quotes) AMEX(American Stock Exchange) |
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WHat kind of stock does NASDAQ exchange
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over the counter stock
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what kind of stock does the NYSE and The AMEX exchange
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unlisted stocks
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when a corporation wants to issue a stock who do they go to the sell and buy a stock for them
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Investment bank
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WHat is the difference between speculators and investors
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Speculators act on guesses to buy and sel stock in short term while investors hope for an increase in the long term
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Speculators who think the proce of stocks willfall
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bears
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Speculators who think price of stock will rise
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Bulls
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WHat is the difernce between a private and a public corporation
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In a private corporation, stocks are not sold to public and in public they are
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the authorazation of allowing someone to vote in your place when dealing with stocks
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Proxy
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A licenced proffesional who buys and sells stock for customers
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stockbroker
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what is a contract?
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a legal agreement between two or more parties
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What are 4 charachteristics of a S Corp
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25-30 stockholders
unlimited life limited liability not subject to double tax |
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what is a Pe ratio
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a price to earnings ration obtained by divididing stocks price by companies latst 12 month earnings per share
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a bond with no collateral
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debenture bond
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a bond where real estate serves as a form of collateral
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mortage bond
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the date at which a bond expires and dividends are due
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maturity date
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another name for interst rate
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coupon rate
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profit given to shareholders
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dividend
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the profitmade from sale of stock
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capital gain
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what is the SEC
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the Securities EXchange Commision. It helps with the buying and selling of securites
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how are bonds differnt from stocks
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bonds earn interst and stocks earn dividends
bondsare a form of loans and stocks are a form of ownership |
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Bonds that score BBB of below and are considered risky
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Junk Bonds
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a bond with zero interest
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zero bond
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a bond sold below face value
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discount bond
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bond sold above face value
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Premium bond
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serves as a stock market indicator and has 30 industrial corporations
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DJIA
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Why is a corporation reffered to as a legal entity
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all leveles of the corporation come together to form a whole
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what are 3 things that a corporation is allowed to do
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enter into contrats
sue or be sued pay taxes |
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waht is the order of liquidation
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Bonds
Preffered stock common stock |
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waht advantage does an S corporation have over a partnership
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it has stock
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waht are the advantages of investing in a mutual fnd
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proffesinal managment
diversification liquidity |
