vocab quiz 1 stocks and bonds

Bond - A loan where the issuer agrees to make regular payments for a set time.

Foreign Exchange Market - A market where exchange rates are determined, helping move money between countries.

Financial Crises - Big disruptions in financial markets with sharp drops in asset values and many company failures.

Monetary Policy - Actions to control interest rates and the money supply.

Conflict of Interest - When one side of a deal puts its own interests ahead of the other’s.

Economies of Scope - Growing a business by offering many products in one convenient location.

Eurobonds - Bonds sold in a country but using a different currency.

Moral Hazard - The risk that one party in a deal will act in a way that harms the other.

Investment Banks - Banks that help companies sell new securities to investors.

Adverse Selection - A problem where the wrong people are most likely to want a deal, due to hidden information.

Derivatives - Financial contracts whose value depends on the price of an underlying asset, often used for hedging risk.