Financial Management and Banking Processes Quiz

Bank's core activities involve accepting deposits from customers and providing loans to borrowers.

ROI measures the profitability of an investment relative to its cost.

Financial managers oversee the financial health of an organization, including budgeting, forecasting, and financial reporting.

The Fed regulates banks, manages monetary policy, and promotes financial stability.

APR represents the annual cost of borrowing, including interest and fees, expressed as a percentage.

Diversification spreads investment across different assets to reduce the impact of any single investment's performance.

Compound interest formula calculates the future value of an investment or loan compounded over time.

Pyramid schemes are fraudulent and illegal methods of financing that rely on recruiting new participants.

SWIFT codes facilitate international transactions by identifying specific banks or financial institutions.

SEC regulates securities markets, enforces securities laws, and protects investors from fraud.

Amortization involves gradual repayment of a loan or debt through scheduled, periodic installments.

Credit rating agencies evaluate the creditworthiness of borrowers and assign credit ratings based on their ability to repay debt.