Questions And Complete The Following Problems

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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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