Answer question 4, is it true or false Convert to PDF, reeasy to shareO Hak Cipta Universiti Teknologi MARAYouNURUL AINA+2CONFIDENTIAL 5 BA/FEB2022/FIN435SECTION B (TRUE/FALSE)Financial markets include the capital markets which mainly deal in short-termfinancial assets.1.(True/False)Interest rates on banker's acceptances are low because the risk of default is very low.(True/False)2.Liquidity risk is the risk where the borrowers not being able to repay the loan leadingto banks suffer the losses.3.(True/False)Transaction risk happens when there is a default payment on the delivery date by oneparty, causing another party to incur losses4.(True/False)Labuan FSA is the statutory body responsible for the development andadministration of the Labuan International Business and Financial Centre5.(True/False)Intermediaries who are agents of investors and match buyers with sellers ofsecurities are called brokers6.(True/False)Money markets are referred to as retail markets because small individual investorsare the primary buyers of money market securities7.(True/False)8.Non-Bank Financial Institutions (NBFIS) are part of the financial institutions in theintermediation process and their roles are specialized in nature such as pension fund,providing insurance business, promoting economic activities for economicdevelopment, credit institution, and others.(True/False)9.Secured Loan is refers to loans not backed by any assets (clean basis) and lenderhas first claim upon default payment.(True/False)10.Interest rates are important to financial institutions since an interest rate increasewill decrease the cost of acquiring funds and increase the income from assets.(True/False)11.Ability to meet commitments is one of the example of red flags.(True/False)12.Cash deposit machines will provide facilities to deposit money to own account, thirdparty accounts and cash payment through online transaction.(True/False)13.The real interest rate is equal to the nominal rate minus inflation(True/False)O Hak Cipta Universiti Teknologi MARACONFIDENTIALCONFIDENTIAL 6 BA/FEB2022/FIN435Al-Mudharabah (investment) conceAti a contract made between provide of capital(depositor) and an entrepreneur cr fund manager (the Bank) to enable the bank tocarry out business ventures within the Shariah guidelines.14.(True/False)

Transaction risk is the risk related with exchange rate fluctuations between agreement and…

Answered: Transaction risk happens when there is…

Transaction risk happens when there is a default payment on the delivery date by one party, causing another party to incur losses 4. (True/False)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Reserves Treasury Securities Real Estate Loans Commercial Loans O 7.69%, No O 8.14%, Yes Assets O 7.27%, No O 6.45%, Yes Table 10 $15 $10 $64 $66 Use Table 10 to calculate the risk weighted capital ratio of First National Bank. Is it well capitalized? Use weights of zero for risk free assets and 0.95 for risky assets. Deposits Capital Liabilities $145 ?
which one is correct please confirm? Q2: "The returns on the following 3-month instruments are quoted in the usual way (i.e. some as discount rates, some as interest yields). Which instrument offers the best rate of return?" 4.58% on a CD 4.5% on a treasury bill 4.55% on a repo 4.56% on commercial paper
q11 Which of the following is an arrangement by which one party promises to pay a sum of money to policyholder as protection against an adverse or unfavorable occurrence of event? a. Short Term Loans b. Fixed Deposit c. Insurance d. Investment q12 Insurance companies and brokerage houses are examples of which of the following. a. Financial instruments b. Financial institutions c. Medium of exchange d. Financial markets
Q4 B) (b) Suppose Bank Negara Malaysia sells RM100 million of bonds to Bank A. By usinga T-accounts, illustrate what happens to the reserves and the monetary base. Answer should be written with proper examples and elaborations. Thank you.
Explain why y0u disagree 0r agree with the f0ll0wing statements. The answer sh0uld n0t be m0re than 3 sentences (with reference of google links) Step 1 Define Treasusy BondS & Corporate Bonds Step 2 Difference between annuity due and ordinary annuity Step 3 Treasury b0nds are riskier than c0rp0rate b0nds. All 0ther things held c0nstant; the future value 0f an 0rdinary annuity is always having a higher future value than annuity due. All 0ther things held c0nstant, the price 0r interest rate risk 0f sh0rt-term b0nd is always l0wer than l0ng-term b0nd
q17 Which of the following types of loans has lower interest rate compared to others? a. Line of Credit b. All the options are wrong c. Long Term Loan d. Short-Term Loan q18 Which of the following is not a Money Market Instrument? a. Certificate of Deposit b. Debentures c. Commercial Paper d. Treasury Bill
Assume you have the following asset and liability in your Balance Sheet: Asset - Bond A Modified Duration = 2.6 years Value = RM1.5 million Liability - Bond B Modified Duration = 3.1 years Value = RM1.0 million a. Calculate the duration gap. b. What is the expected change in Net Worth if interest increases by 1%? c. What should or could you to achieve immunised balance sheet? Note: Please show all workings.
QUESTION #4 the following “T-accounts” with the following data $100 million in mortgage-backed securities (MBS) $200 million demand deposits $20 million in reserves held by banks $100 million in Treasury securities held by banks $50 million in Treasury securities held by the Fed $5 million in overnight borrowing by banks from the Fed Suppose that the Fed wants to lower long-term interest rates and buys all the Treasury securities banks hold. Reflect those changes on the balance sheet (commitment to low long term interest rate environment, QE) and highlight in turquoise Households Banks Federal Reserve Firms ___A_______L___ ___A_______L___ ___A_____L___ ___A_____L___
QUESTION 5 A bank with $10,000 in assets has ROA =2% and ROE =10%. What is its leverage ratio (TA/Equity)? 2.5 5 4 1.25 QUESTION 6 The expected loss of a loan is a function of the following, except Unexpected loss Loss given default Exposure at default Probability of default
H10. Assume that initially, the risk premium, ρ = 0 and that the domestic and foreign interest rates are given by R = .06, R* = .05. Suppose that the risk premium depends linearly on the difference between domestic government debt, B, and domestic assets of the central bank, A, i.e., ρ = ρ (B-A) Find the new domestic interest rate if a sterilized purchase of foreign assets adjusts A s.t. (a) B - A = -.01/ ρ0 (b) B - A = .03/ ρ0
1) Expectations of asset values by participants in financial markets 2) When market participants use all available information 3) Which of the following is NOT a way in which prices communicate information in the markets for bonds, stocks, foreign exchange, and financial instruments? 4) The gap between the yield on a corporate bond and the yield on a U.S. Treasury bond of the same maturity represents 5) If the interest rate on a ten-year bond issued by GM is 7.8% while the interest rate on a ten-year treasury bond is 4.6%, the risk premium is 6) If the dollar is expected to depreciate against the Japanese yen during the next 60 days, then 7) If the dollar is expected to depreciate against the British pound during the next 60 days, then 8) When the market price of a financial instrument equals its present value, savers and borrower can be sure that 9) If a company's sales begin to fall off so that it is now more likely to default on its bonds than financial markets had…
Q12. The following are commonly used plug items, except a. cash and marketable securities b. equity c. short-term debt d. long-term debt e. all of the choices

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