322-1

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Author:
SAngell3
ID:
218948
Filename:
322-1
Updated:
2013-06-04 13:17:02
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322
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322-1
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  1. The term "financial system" refers to the collection of markets, individuals and institutions, laws, regulations, and techniques through which cash is traded and interest rates determined. 

    A) True  
    B) False
    B) False
  2. The construction of office buildings, highways, schools, and homes is normally financed by loans from the financial markets.  
    A) True  
    B) False
    A) True  
  3. Arbitrageurs help to insure differentials between financial markets.
     
    A) True  
    B) False
    A) True  
  4. A major problem faced by Japan today is too little saving by its citizens.  

    A) True 
    B) False
    B) False
  5. The largest borrower in the capital market is:
     
    A) businesses.  
    B) households.  
    C) commercial banks.  
    D) government.  
    E) none of the above
    D) government.  
    (this multiple choice question has been scrambled)
  6. Perfect liquidity is a trait held by:  

    A) bonds.  
    B) stocks.  
    C) CDs.  
    D) 30 year U.S. Treasury bonds.  
    E) none of the above
    E) none of the above
  7. Low savings rates in the United States prior to 2007 could be attributed to:  

    A) low unemployment.  
    B) short periods of prosperity.  
    C) direct experience of the Great Depression.  
    D) value of homes has risen substantially.   E) A and D only
    E) A and D only
  8. Two areas that are major sources of funding for loans are:
      
    A) personal savings and taxes.  
    B) business savings and taxes.  
    C) taxes and net profit.  
    D) profits and bonds.  
    E) none of the above
    E) none of the above
  9. Arbitrage occurs when:  

    A) a new security is issued.  
    B) a company is in need of funds.  
    C) a large institution faces default.  
    D) interest rates in Europe are the same as the US.  
    E) none of the above
    E) none of the above

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