Finance 340 chapter 2

Which of the following correctly describes a repurchase agreement?The sale of a security with a commitment to repurchase the same security at a specified future date and a designated price. The sale of a security with a commitment to repurchase the same security at a future date left unspecified, at a designated price. The purchase of a security with a commitment to purchase more of the same security at a specified future date. The sale of a security with a commitment to repurchase the same security at a specified future date and a designated price.
A dollar-denominated deposit at a London bank is called _____. eurodollar
Money market securities are sometimes referred to as cash equivalents because _____. they are safe and marketable
The most marketable money market security is _____. treasury bills
_____ is considered to be an emerging market country. brazil
The bid price of a Treasury bill is _________. the price at which the dealer in Treasury bills is willing to buy the bill
Deposits of commercial banks at the Federal Reserve are called _____. federal funds
Which of the following is not a true statement regarding municipal bonds? A municipal bond is a debt obligation issued by state or local governments. A municipal bond is a debt obligation issued by the federal government. The interest income from a municipal bond is exempt from federal income taxation. The interest income from a municipal bond is exempt from state and local taxation in the issuing state. A municipal bond is a debt obligation issued by the federal government.
An individual who goes short in a futures position _____. commits to delivering the underlying commodity at contract maturity
Which of the following is not a nickname for an agency associated with the mortgage markets? Fannie Mae Freddie Mac Sallie Mae Ginnie Mae sallie mae
Commercial paper is a short-term security issued by __________ to raise funds. large well-known companies
The maximum maturity on commercial paper is _____. 270 days
Which one of the following is a true statement regarding the Dow Jones Industrial Average? It is a price-weighted average of 30 large industrial stocks.
A bond that has no collateral is called a _________. debenture
A __________ gives its holder the right to sell an asset for a specified exercise price on or before a specified expiration date. put option
The yield on tax-exempt bonds is ______. usually less than 50% of the yield on taxable bonds normally about 90% of the yield on taxable bonds greater than the yield on taxable bonds less than the yield on taxable bonds less than the yield on taxable bonds
A __________ gives its holder the right to buy an asset for a specified exercise price on or before a specified expiration date. call option

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