With proper explanation please 5.On March 23, 2020 the Fed responded to theCoronavirus Crisis by taking the following actionsI. Established the Primary Market CorporateCredit Facility (PMCCF)II. Restarted the Term Asset-Backed SecuritiesLoan Facility (TALF)III. Expanded its EQ purchases which increasedthe volume of equity investments to help supportpension fundsа.| onlyb.| and II onlyС.Il and III onlyd.I, Il and III

On March 23,2020 federal bank try to support consumer and corporate which were facing liquidity…

On March 23, 2020 the Fed responded to the Coronavirus Crisis by taking the following action: 1. Established the Primary Market Corporate Credit Facility (PMCCF) |I. Restarted the Term Asset-Backed Securities Loan Facility (TALF) II. Expanded its EQ purchases which increased the volume of equity investments to help suppor pension funds a. | only

On March 23, 2020 the Fed responded to the Coronavirus Crisis by taking the following action: 1. Established the Primary Market Corporate Credit Facility (PMCCF) |I. Restarted the Term Asset-Backed Securities Loan Facility (TALF) II. Expanded its EQ purchases which increased the volume of equity investments to help suppor pension funds a. | only

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter8: Securities Law Considerations When Obtaining Venture Financing

Section: Chapter Questions

Problem 1gM

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For each of the following monetary policy tools:A. The BSP buys securities in the open market.B. The BSP sells foreign exchange currentC. The BSP increases the reserve requirement ratio.D. The BSP applies its moral suasion ability requesting commercial banks to lowerdown interest rates.E. The government decided to deposit funds at the BSP.1. Determine whether the monetary tool imposed by the BSP is an expansionary or acontractionary policy.
To strengthen the dollar using sterilized intervention, the Fed would simultaneously Treasury securities. O buy, buy O buy; sell O sell; sell O sell; buy dollars and
27.Which of the following statements are true?Statement I. Money markets are used to facilitate the transfer of short-term funds from individuals, corporations, or governments with excess funds to those with deficient funds. Even investors who focus on long-term securities tend to hold some money market securities because this enables them to maintain liquidity. Statement II. Financial institutions manage their liquidity by participating in money markets. They may issue money market securities when they experience cash shortages and need to boost liquidity. They can also sell holdings of money market securities to obtain cash.Statement III. The value of a money market security represents the future value of the present cash flows generated by that security. Since money market securities represent debt, their expected cash flows are typically known.Statement IV. The pricing of money market securities changes in response to a shift in the required rate of return by investors. The…
What are some of the ways that banks can borrow short-term funds when they need "liquidity"?(Select all that apply; three of the answers below are correct.) Reference: Chapters 11 & 12 They can borrow directly from the Securities & Exchange Commission through the "regulatory" market. They can borrow from the Department of Treasury through the "Treasury" window. They can borrow another bank's reserves through the "fed funds" market. The can engage in a "sale & repurchase agreement" (or "repo") by selling some of their securities to another financial insitution and promising to buy them back the next day. They can borrow directly from the Federal Reserve through the "discount window".
Q1: Define and differentiate between: a) Organized exchanges and Over the counter markets b) Open Ended vs Closed Ended Mutual Funds C) Moral Hazard and Adverse selection Q2: What is meant by asset transformation and how is it the basis for differentiating between indirect finance and direct finance? Q3: What are the three main reasons for regulating financial markets and institutions? Also list the major regulation examples under each of the three reasons. Q4: What value do mutual funds add for individual investors and how? Q5: Using the relevant financial securities and institutions, explain the chain of events which lead to the 2007 global financial crisis. Q6: Last year Fauji Fertilizer Company Limited (FFCI) gave an annual dividend per share of Rs. 8.85 which is expected to grow at 5%, forever. Calculate the per share price of the stock if its required rate of return is 14%? Q7: Calculate the duration of a 7-year coupon bond having a 11% coupon rate. The current market yield of…
If reserves are scarce, how would the federal funds rate change (increase or decrease) if the Fed:(a) sells mortgage-backed securities(b) decreases the (minimum) reserve requirements(c) conducts overnight repo operations(d) conducts overnight reverse repo operations.
Which of the following is most true? The nominal rate of a government long-term security can be used as a proxy for the real risk free rate. A direct relationship is exhibited between the investors’ willingness to supply funds and the interest rates of securities. Finance managers tend to favor more on long-term financing if the nation’s Gross Domestic Product is expected to contract. Maturity risk premium is always included in the nominal rate of any corporate security since corporations are perceived as less riskier than government.
Say the Fed wants to increase the money supply in the country. Which of the following open market operations would be appropriate to create $12.250 in the banking system if the reserve requirement is 2%? (A) Sell $250 worth of government bonds (B) Sell $12,250 worth of government bonds (C) None of these answers (D)Buy $250 worth of government bonds (E)Buy $12,250 worth of government bonds
Conside the following shocks to the bond market: (A) an increase in perceived risk, (B) an increase in the government deficit. Explain how the above shocks to the bond market affect the money market. Show your findings graphically, making sure that all is labeled correctly.
1. How has deregulation of the financial services industry affected the makeup offinancial intermediaries? How do you think intermediaries’ characteristics willchange in the future? 2. How do banking organizations in the United States differ from banking organizationsin other countries? Why are they different? 3. How is money created in a banking system that has fractional reserve requirements(i.e., a fractional reserve system)? 4. Describe the open market operations undertaken by the Federal Reserve. Whattype of trades would the Fed make if it wanted to increase interest rates? 5. How would funds—that is, the money supply—in the United States be affectedif the Federal Reserve increases reserve requirements? Give an example.
Which of the following statements regarding the banks motives for holding reserves is incorrect ? A ) If banks on average expect an increase in policy rates they will be inclined to decrease their reserve holdings. B ) As the opportunity cost of holding reserves increase ,ceteris paribus banks are expected to decreasetheir holdings. C ) Depending on the volatility of fund inflows and outflows banks adjust the amount of their reserve holdings accordingly. D ) Under instable financial conditions banks are inclined to hold higher amounts of reserves compared to normal levels.
Match the following: Group of answer choices A. One of the largest buyers of U.S. subprime securities B. Filed for bankruptcy due to a short-term liquidity crisis C. Losses that rise unexpectedly due to unforeseen risks in a bank’s portfolio D. The federal reserve bought long-term bonds and sold an equivalent amount of short-term bonds to prop up the economy E. Places primary responsibility of accurate financial reports on CEOs and CFOs F. Established a hedging program to protect against market volatility Merck - SOX - Operation Twist - Lehman Brothers - Dark Side -…