Questions And Complete The Following Problems

Satisfactory Essays
Answer the following questions and complete the following problems, as applicable. 1. Classify the following transactions as taking place in the primary or secondary markets: • IBM issues $200 million of new common stock. Primary Market • The New Company issues $50 million of common stock in an IPO. Primary Market • IBM sells $5 million of GM preferred stock from its marketable securities portfolio. Secondary market • The Magellan Fund buys $100 million of previously issued IBM bonds. Secondary Market • Prudential Insurance Co. sells $10 million of GM common stock. Primary Market 2. Classify the following financial instruments as money market securities or capital market securities: • Federal Funds money market securities • Common Stock capital market securities • Corporate Bonds capital market securities • Mortgages capital market securities • Negotiable Certificates of Deposit money market securities • U.S. Treasury Bills money market securities • U.S. Treasury Notes capital market securities • U.S. Treasury Bonds capital market securities • State and Government Bonds capital market securities 3. What are the different types of financial institutions? Include a description of the main services offered by each. The seven types of financial institution are as follows; A. Commercial Banks- depository whose major assets are loans and whose major liabilities are deposits, commercial banks covers a broader range, including consumer, commercial and real estate loans. Commercial
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