Solution Manual for Introduction to Finance: Markets, Investments, and Financial Management, 16th Edition

Product details:

• ISBN-10 ‏ : ‎ 1119398282
• ISBN-13 ‏ : ‎ 978-1119398288
• Author:

The Sixteenth Edition of Introduction to Finance: Markets, Investments, and Financial Management is now available as an enhanced e-text with new interactive figures for students. This title builds upon the successes of its earlier editions while maintaining a fresh and up-to-date coverage of the field of finance. Distinguished authors Ron Melicher and Edgar Norton continue to cover the three major financial areas: institutions and markets, investments, and financial management. Their effective structure equips instructors with maximum flexibility for how the course is taught, and provides students with an integrated perspective of the different foundations of finance. This survey of the basic knowledge, concepts, and terms of finance is appropriate for all students.

Table contents:

Part 1 Institutions and Markets

1 The Financial Environment 5

1.1 What is Finance? 6

1.2 Why Study Finance? 8

1.3 Six Principles of Finance 10

1.4 Overview of the Financial System 13

1.5 Financial Markets: Characteristics and Types 17

1.6 Careers in Finance 18

1.7 The Plan of Study 20

Applying Finance To. . . 21

Summary 21

Key Terms 22

Review Questions 22

Exercises 22

2 Money and the Monetary System 24

2.1 The 2007–2008 Financial Crisis and Subsequent Recovery 25

2.2 Process of Moving Savings into Investments 26

2.3 Overview of the Monetary System 28

2.4 Characteristics and Functions of Money 29

2.5 Development of Money in the United States 31

2.6 Money Market Securities 37

2.7 Measures of the U.S. Money Supply 38

2.8 Money Supply and Economic Activity 41

2.9 International Monetary System 42

Applying Finance To. . . 44

Summary 44

Key Terms 45

Review Questions 45

Exercises 46

Problems 47

3 Banks and Other Financial Institutions 49

3.1 Financial Institution Problems During the 2007–2008 Financial Crisis 50

3.2 Types and Roles of Financial Institutions 51

3.3 Overview of the Banking System 55

3.4 Historical Development of the U.S. Banking System 58

3.5 Regulation of the Banking System 60

3.6 Structure of Banks 65

3.7 The Bank Balance Sheet 66

3.8 Bank Management 71

3.9 International Banking and Foreign Systems 75

Applying Finance To. . . 76

Summary 77

Key Terms 78

Review Questions 78

Exercises 79

Problems 79

4 Federal Reserve System 82

4.1 U.S. Central Bank Response to the Financial Crisis and Great Recession 83

4.2 The U.S. Banking System Prior to the Fed 84

4.3 Structure of the Federal Reserve System 86

4.4 Monetary Policy Functions and Instruments 92

4.5 Fed Supervisory and Regulatory Functions 99

4.6 Fed Service Functions 101

4.7 Central Banks in Other Countries 103

Applying Finance To. . . 104

Summary 104

Key Terms 105

Review Questions 105

Exercises 106

Problems 107

5 Policy Makers and the Money Supply 109

5.1 National Economic Policy Objectives 110

5.2 Four Policy Maker Groups 112

5.3 Government Influence on the Economy 114

5.4 Treasury Cash and General Management Responsibilities 116

5.5 Treasury Deficit Financing and Debt Management Responsibilities 120

5.6 Changing the Money Supply 122

5.7 Factors Affecting Bank Reserves 128

5.8 The Monetary Base and the Money Multiplier 131

Applying Finance To. . . 133

Summary 133

Key Terms 134

Review Questions 134

Exercises 135

Problems 135

6 International Finance and Trade 137

6.1 International Monetary System 138

6.2 European Unification 140

6.3 Currency Exchange Markets and Rates 142

6.4 Factors that Affect Currency Exchange Rates 145

6.5 Conducting Business Internationally 149

6.6 Financing International Trade 151

6.7 Developments in U.S. International Transactions 157

Applying Finance To. . . 161

Summary 161

Key Terms 162

Review Questions 162

Exercises 163

Problems 164

6.8 Exchange Rate Risks in Global Business 166

Hedging Cash Flows 167

Speculating or Taking Educated Guesses on Exchange Rate Movements 168

Where to Invest? 168

Summary 169

Review Questions 170

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