Introduction to Finance

Future value
Value of a savings amount or 
an investment at a specifi ed time or date in the 
future
Futures contract
A contract obligating the 
owner to purchase or sell the underlying asset 
at a specifi ed price on a specifi ed day
Generally accepted accounting principles 
(GAAP)
Set of guidelines as to the form 
and manner in which accounting information 
should be presented
Glass-Steagall Act of 1933
Provided for 
separation of commercial banking and invest-
ment banking activities in the United States
Global bonds
Bonds that are generally denom-
inated in U.S. Dollars and marketed globally
Global depository receipt (GDR)
Listed 
on 
the London stock exchange; facilitates trading 
in foreign shares
Gold standard
A standard in which cur-
rencies of major countries are convertible into 
gold at fi xed exchange rates
Goodwill
An intangible asset that represents 
the excess funds paid when one fi rm merges 
with or purchases another over and above the 
accounting value of the fi rm’s net assets
Gordon model (constant dividend growth 
model)
A means of estimating common 
stock prices by assuming constant dividend 
growth over time
Government expenditures (GE)
Expendi-
tures for goods and services plus gross 
investments by federal, state, and local gov-
ernments
Government National Mortgage Association 
(Ginnie Mae)
created to issue its own debt 
securities to obtain funds that are invested in 
mortgages made to low-income to moderate- 
income home purchasers
Gramm-Leach-Bliley Act of 1999
Repealed 
the separation of commercial banking and 
investment banking provided for in the glass-
steagall act of 1933