Explain the statement “The money market is necessary but not sufficient for the liquidity of securities on the stock market

Q: what is meant by “The money market is necessary but not sufficient for the liquidity of securities…

A: Solution- The money market is an organized exchange market where participants can lend and borrow…

Q: The Money Markets is different from the Capital Markets. What are the financial instruments traded…

A: Money Market : Money market is the financial market where the instruments that have a short term…

Q: What is the difference between the dealer and the broker in the stock market? (Explain clearly.)

A: Broker:   A broker is a person who will buy and sell securities for their client.   Dealer:   A…

Q: For investors, the function of secondary markets is to provide marketability for the shares of…

A: Secondary market is a type of market where investors buy and sell securities or assets from other…

Q: State the assumption about the “boot” that is made in the treasury Stock Method

A: Treasury Stock method:  The treasury stock methodology is a method used by companies to compute the…

Q: hich of the following is correct?   Transactions within the spot market can be used to mitigate and…

A: Hedging can be done by using forward and future and option market and can be used to mitigate spot…

Q: 1) The capital market consist of : A. Treasury bill B. Certificate of deposit C. Purchases agreement…

A: Since more than three sub parts are posted at a time, the answer for first three questions is only…

Q: According to our authors, when is the purchase of stock in one company by another classified as a…

A: Trading security- Classification of securities- There are three different classification: a) held…

Q: How does forward pe effect the stock market?

A: P/E refers to the price earnings ratio. It is one of the important valuation metrics that we use in…

Q: What are the pros and cons of dealer markets (e.g. - treasury bond markets) as compared to trading…

A: The financial market known as a "dealer market" is where dealers list the prices at which they would…

Q: A fundamental analyst uses the discounted cashflow method to value firms, and has a short-term…

A: Fundamental Analysis is a technique to value firms on the basis of their fundamentals i.e. their…

Q: What effect does the trend in stock prices (subsequent to issue) have on afirm’s ability to raise…

A: At different interval of time, firm may require capital to invest in various investment proposals.…

Q: explain the statement"The money market is neccessary but not sufficinet for the liduiidity of…

A: Money market is an instrument used to provide flow of short term funds in the economy. It consist of…

Q: Discuss how changes in the general stock and bond markets could lead to changes in the required rate…

A: Required rate of return- is the minimum rate of return which an investor expects in return  for a…

Q: All of the following could be considered a financial security with the exception of: Treasury bond…

A: The question is related to Financial security. Financial securities are Shares, debentures,…

Q: Would a typical common stock provide cash flows more like an annuity or more likean uneven cash flow…

A: Common stock is an instrument that is the property of a company. Common stock investors elect the…

Q: Both individuals and companies monitor the stock market. Explain how their reasons for doing so…

A: individual monitor their stock price by the following steps 1) keep updated about the latest news…

Q: Marketable securities are liquid financial instruments that can be quickly converted into cash at a…

A: Cash and cash equivalents are the most liquid current asset items included in quick assets, while…

Q: Which of the following is not a money market instrument? a. Equity Shares b. Treasury Bills c.…

A: Money market instrument means those instrument which are issued in money market and generally for…

Q: Why would a corporation elect to raise funds via a securitization rather than a corporate bond?

A: An indirect claim security whose value (in whole or in part) is derived from the market price of the…

Q: Explain the role of speculators in determining the price of a security on the stock market

A: Stock market are platform where there is trading of stocks happen so there is buying and selling of…

Q: n the general stock and bond markets lead to changes in the required rate of return on a firm’s…

A: Step 1 The required reimbursement rate is the minimum refund that an investor will receive from…

Q: The cash flows associated with common stock are more difficult to estimate than those related to…

A: Common stock is the pool of common shares that a company issues

Q: Why do stock companies prefer equity financing in raising money for their operations than debt…

A: Equity financing refers to the process whereby a company raises the funds by issuing equity. The…

Q: Why do firms generally prefer to borrow funds to obtain long-term financing rather than issue shares…

A: When a firm or company needs capital to grow or start a new project then it uses debt or equity or…

Q: stock markets protect a firms shares from liquidity? true or false

A: Stock markets are said to be amongst the foremost vital components of a free-market economy where…

Q: ket transactions are made in marketable s

A: Introduction : The acceptance by the Borrowers or a Subsidiaries of funds from an exchange of…

Q: The ____ theory holds that the securities markets are demarcated by maturity.   a. expectations…

A: Expectations theory attempts to predict what short-term interest rates will be in the future based…

Q: Why are unrealized gains and losses on trading securities reported in the incomestatement?

A: Unrealized gains and losses: Trading securities are reported at their fair values. Unrealized gains…

Q: Would a typical common stock provide cash flows like an annuity or more like an uneven cash flow…

A: Common Stock is a security that represents ownership in a firm. Common stock holder can earn returns…

Q: Explain the stock market, bond market, capital market and money market

A: STOCK MARKET It is a collection of markets where publicly held companies issue their shares and the…

Q: If most participants in the stock market do not follow what is happening to monetary aggregates,…

A: Stock market is the place where various financial securities such as common stocks, preference…

Q: How does pe effect the stock market

A: PE reflects the price to earning ratio. It is the ratio of current market price to the earning for…

Q: ______ is a method of evaluating securities by identifying a stock trend such as prices and volume…

A: Financial securities are the financial assets that are traded in the financial markets. Financial…

Q: It is said that open market transactions involve the sale or purchase of securities by the BSP to…

A: Central bank of country do open market transactions to increase or decrease money supply in markets.

Q: Buying common stock is riskier than buying a U.S Treasury bill. state reason in 'other'   true False

A: Common stock refers to the stock issued by public companies to the public for the purpose of raising…

Q: Which one of the following is NOT a 'Money Market Instrument? Select one: O a. Treasury Bills O b.…

A: Money market instrument refers to the short-term maturity financial instruments which are having a…

Q: or financial traders to predict the direction of stock market price movement?

A: In the market direction and trends are important in the stock because stock market is not ideal…

Q: In your opinion, should a public listed company pay attention to the market price of its common…

A: Market prices are decided by the demand and supply(D/S) of the security and investors perception…

Q: Secondary Market can be best described in which of the following statement? a. It is a market for an…

A: Stock market there are buying and selling of securities are done depending on demand and supply of…

Q: What happens to the buyer's assets and equity when they buy treasury stock?

A: This question tells about The purchase of Treasury shares has an impact on the assets and equity of…

Q: Why is stock exchange referred to as a secondary market? What functions does it perform?

A: Primary Market: In primary market shares are directly offered to public for subscription . it is…