AD212 American Business and Management

Chapter 19: "Understanding Money, Banking, and Credit"

There is no additional reading.

Why was the Federal Reserve System created in 1913? What are the Fed's main functions, and how does it carry them out? How does the Fed aid business and commerce in the US? Does it ever hinder them?

Go to the web address for Wachovia Bank's small business operations, www.wachovia.com/small_biz/advisor/solution_finder. Fill in the questionnaire with realistic data. Then click on "Submit Company Profile" to see what the bank has to offer your business. How useful would these services be to your (fictitious) company?

Your business is doing well, and there is the expectation that in a few years you will undertake considerable expansion, requiring that you borrow additional funds (say, between $500,00 and $1 million). What can you do between now and then to help assure getting a loan on good terms? What will you need to do at the time of the loan in order to get the money?

In recent years, a number of companies have been started (or expanded) using credit cards for financing. What are the advantages and disadvantages of going that route? For you personally, what are the advantages and the costs/pitfalls of credit card use?

Why did Willie Sutton rob banks?