Chapter 2 Financial Markets

Descrição

Quiz sobre Chapter 2 Financial Markets, criado por run2hurdle em 26-09-2015.
run2hurdle
Quiz por run2hurdle, atualizado more than 1 year ago
run2hurdle
Criado por run2hurdle mais de 8 anos atrás
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Resumo de Recurso

Questão 1

Questão
Money market securities have maturities of one year or less.
Responda
  • True
  • False

Questão 2

Questão
Preferred stock pays a variable dividend.
Responda
  • True
  • False

Questão 3

Questão
The cost of borrowing funds is most commonly called the interest rate.
Responda
  • True
  • False

Questão 4

Questão
The primary market is the only market in which the issuer is directly involved in the transaction and recieves direct benefits from the issue.
Responda
  • True
  • False

Questão 5

Questão
The over-the-counter market is generally reserved for stocks with very large trading volume.
Responda
  • True
  • False

Questão 6

Questão
T-Bonds are money market securities, while T-bills and T-notes are traded in the capital market.
Responda
  • True
  • False

Questão 7

Questão
Market makers include both specialist and dealers.
Responda
  • True
  • False

Questão 8

Questão
Specialist and dealers determine the price of the security.
Responda
  • True
  • False

Questão 9

Questão
Corporate bonds pay interest payments that are usually tax-exempt to investors.
Responda
  • True
  • False

Questão 10

Questão
The New York Stock Exchange is an example of an organized market.
Responda
  • True
  • False

Questão 11

Questão
Earnings should retained only if the firm needs capital very badly and would have difficulty raising it from external sources.
Responda
  • True
  • False

Questão 12

Questão
The importance of the role of financial management is emphasized by examples of companies whose strategic financing decisions contributed to their demise, or to their success when economic conditions changed rapidly.
Responda
  • True
  • False

Questão 13

Questão
The riskiness inherent in a firm's earnings per share (EPS) depends on both the types of projects the firm takes on and the manner in which the projects are financed.
Responda
  • True
  • False

Questão 14

Questão
The two most important functions of markets are to establish fair prices and provide liquidity.
Responda
  • True
  • False

Questão 15

Questão
Bonds are long-term loans that typically pay interest per year based on the average bank rate.
Responda
  • True
  • False

Questão 16

Questão
The _______ is a financial relationship created by a number of institutions with arrangements that allow the suppliers and demanders of long term funds to make transactions.
Responda
  • money market
  • bond market
  • capital market
  • eurobond market

Questão 17

Questão
The AMEX Exchange could be classified as a/an ______ security exchange.
Responda
  • organized
  • over-the-counter
  • primary
  • closed

Questão 18

Questão
In the over-the-counter market, dealers are linked with the purchasers and sellers of securities through the _____ system.
Responda
  • NASDAQ
  • bonds
  • stocks
  • short-term funds

Questão 19

Questão
Common stockholders expect to receive a return through capital gains and
Responda
  • interest payments
  • dividends
  • fixed periodic dividends
  • coupon payments

Questão 20

Questão
Bonds with an AAA rating will have a ______ interest rate compared to bonds with a BAA rating.
Responda
  • lower
  • equal
  • higher
  • undetermined

Questão 21

Questão
The______ is the financial market in which securities are initially issued.
Responda
  • OTC
  • secondary market
  • primary market
  • private placement

Questão 22

Questão
________ are long-term debt instruments that are used by business and government to raise large sums of money.
Responda
  • T-bills
  • Common stock
  • Preferred stock
  • Bonds

Questão 23

Questão
Shares of ____ are units of ownerships interest, or equity, in a corporation.
Responda
  • bank loans
  • common stock
  • debt
  • commercial paper

Questão 24

Questão
The possibility that the issuer of debt will not pay the principal as scheduled.
Responda
  • liquidity risk
  • default risk
  • contractual risk
  • maturity risk

Questão 25

Questão
Which of the following does not need to be considered when assessing the impact of financial decision?
Responda
  • Financial market conditions
  • timing of the earnings flow
  • project earnings
  • all of the above must be considered.

Questão 26

Questão
Money markets are markets for
Responda
  • foreign currency exchange
  • corporate stocks
  • long-term bonds
  • short-term debt securities

Questão 27

Questão
Which of the following is not a major participant in the money market.
Responda
  • Federal Reserve
  • Commercial Banks
  • Money Market Mutual Funds
  • Wall Street Dealers

Questão 28

Questão
If a $2,000 bond is quoted at 120:16, the price of the bond is ______
Responda
  • 1,205.31
  • 1,205.00
  • 2,410.62
  • 2,410.00

Questão 29

Questão
The difference between Common Stock and Preferred Stock lies in:
Responda
  • vote or not
  • fixed or variable dividends
  • Priority of claim on assets
  • all of the above

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