Which of the following is not true withMoney Market?Select one:O a. Deals in short term fundsO b. Provides funds for fixed capitalc. None of the optionsO d. Provides link between depositors andborrowers

The money market is a type of financial market that deals with near-term instruments.

Which of the following is not true with Money Market? Select one: O a. Deals in short term funds b. Provides funds for fixed capital c. None of the options O d. Provides link between depositors and borrowers

Which of the following is not true with Money Market? Select one: O a. Deals in short term funds b. Provides funds for fixed capital c. None of the options O d. Provides link between depositors and borrowers

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter11: Managing Transaction Exposure

Section: Chapter Questions

Problem 2ST

See similar textbooks

Related questions

Q: What is the advantage of using short-term funds? a. there is no advantage b. easily obtained c.…

A: Corporate finance is referred as the decision of the firm to take capital investments and other…

Q: Which one of the following is not a part of money market? a. Call money market b. Commercial…

Q: Cash equivalents' is defined as 'short-term, ___________ investments that are readily convertible to…

A: Cash and cash equivalent means the amount of cash , bank or highly liquid marketable securities…

Q: Active secondary markets

A: Secondary Market: Secondary market is the market where the securities are bought or sold without the…

Q: Which of the following is most likely to expose the holders to counterparty credit risk? A.…

A: Counterparty credit risk is the risk where the party involved in the transactions makes default in…

Q: Describe the process of a money market hedge for payables. Please do not just rewrite the formula,…

A: Money-market is a market that provides funds for a short-term loan or less than a year. There are…

Q: The average maturity of its assets is larger than that of its deposits, as is typical of most banks.…

A: Assume we take the case of a bank. For a bank the long term loans are a resource and deposits are…

Q: Which of the following investment types cannot be sold during normal market hours? a) mutual fund…

A: Investment is a process of investing money with the motive of making more money. The person who…

Q: Which of the following is NOT a principle of finance? Select one: O a. risk-return tradeoff O b.…

A: Principles of finance are the guidelines that helps an investor to make the right investment and…

Q: The flow of funds through financial markets increases the volume of savings and investment by:…

A: Saving and investment are the key factor in any economic development. Person having sufficient money…

Q: Which of the following is NOT an external method of interest rate risk management? * A. Using…

A: An interest rate risk is the risk of negative affected of the value of an investment by unexpected…

Q: Loans are collateralized to: a increase returns b increase liquidity c reduce concentration risk d…

A: Note: Since you have posted multiple questions, we will solve the first question for you as per…

Q: Which of the following is not true with Money Market? Select one: a. Deals in short term funds b.…

A: Money market is a market wherein short term instruments are traded and only those investors who are…

Q: Which one of the following statements is correct? Multiple Choice Short-term investments tend to…

A: Because you have posted multiple questions, we will answer the first question only, for the…

Q: Financial markets that facilitate the flow of short-term funds are known as: O Primary markets O…

A: Financial markets can be defined as the market where financial assets or instruments are traded.…

Q: Does the FASB considers options as securities or as cash?

A: FASB is the Financial accounting standard board

Q: is NOT a characteristic of a money market instrument. A. illiquidity B. short maturity C. low risk…

A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…

Q: A trade finance instrument not supported by bank guarantee is called O a. Irrevocable LC O…

A: Answer: There are various types of financial instruments that can be traded on return of any goods…

Q: The "money mrket" is a misnomer. Money (currency) is not actually tradedin the money markets. The…

A: money market is the place where short term debt instrument is traded.

Q: What are the two ways sinking funds can be handled? Which alternative will be usedif interest rates…

A: Answer: Sinking fund is a particular fund generated to repay its borrowed funds that collected…

Q: Short-term loan from banks is not an example about debt capital. Select one: O True O False

A: A short-term loan is a type of loan that is obtained to support a temporary personal or business…

Q: How does the creation of a Treasury STRIP help the government raise cash? Seleccione una: a. It does…

A: The separation of interest and principal amount on security and trading is also done separately then…

Q: Short Q/Ans: Answer shortly by just giving reasons Q: Indirect transfer through investment bankers…

A: In a well-functioning economy, capital will flow efficiently from saver to borrower. The transfer of…

Q: The surplus and deficit economic agents engage in financial markets transactions to satisfy their…

A: Stock markets, fixed income markets, foreign exchange markets, and derivatives markets are all…

Q: The capital asset pricing model expresses the cost of equity as a function of a return on riskless…

A: The term capital structure refers to the structure of debt and equity financing in the company. A…

Q: An increase in the riskiness of financial securities results in a_______ in the supply of loanable…

A: The riskiness of financial securities or financial risk is defined as the threat of losing the money…

Q: What is a limitation common to both the current and quick ratio? * Debtors may not pay on…

A: CURRENT RATIO: current ratio = current assetcurrent liabilities QUICK RATIO: quick ratio = current…

Q: Assess the following statement: I. Money markets exist to help reduce the opportunity cost of…

A: Dealing in debt with a maturity of less than one year is referred to as the money market.…

Q: Discuss briefly the liquidity preference theory (LFT) and differentiate it from the loanable funds…

A: Liquidity is referred as the degree, where the security used to buy or sell quickly in the market at…

Q: A. Briefly explain the problem of moral hazard in: (i) Equity financing (ii) Debt financing B.…

A: When there is an rise in the expected loss because of individuals and companies behaving carelessly,…

Q: ndicate whether each statement is true or false. a) A naive hedge is the hedge of a cash asset on a…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: All things considered stable cash flows enable higher debt borrowing.

A: Cashflows: These are movement of the money from various sources like operations, investment…

Q: Which are The very different patterns of cash flows on the securities which just described raise…

A: Capital budgeting is vital in marketing decisions. Decisions on investment, which take time to…

Q: With respect to hedge fund investing, the net return to an investor in a fund of funds would be…

A: The net return to an investor in a fund of funds would be lower than that earned from an individual…

Q: Under the Pure Expectations Theory, if issuers expect interest rates to increase, O Two statements…

A: The Pure expectancy theory explains the term structure of interest rate. The theory explains that…

Q: Describe the process of a money market hedge for payables. Do not rewrite the formula, explain it.

A: Money market hedging helps the domestic company to reduce the exchange rate along with the currency…

Q: QUESTION 6 All of following can be considered differences between commerical banks and contractual…

A: Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Individuals are more likely to use a bond fund strategy wher O there is low interest rate. the cost…

A: Simply speaking, bond fund strategy is where there is transferring of money in and out of bond fund…

Q: f the Bank of England wanted to discourage investment sp ggregate demand, it could Select one: O a.…

A: Bank of England do open market operations to implement the policies regarding the economy and growth…

Q: Classify each of the following in terms of their effect on interest rates (increase or decrease): I.…

A: Interest rates Interest rate is referred to as the amount a lender charges to a borrower and is a…

Q: Which of the following can be categorized as Short term sources of finance? i Equity Shares ii.…

A: Source of finance can be both short term and long term

Q: What are the two ways a sinking fund can be handled? Whichmethod will be chosen by the firm if…

A: A sinking fund is a fund created periodically by setting aside money for the gradual repayment of a…

Question

Which of the following is not true with
Money Market?
Select one:
O a. Deals in short term funds
O b. Provides funds for fixed capital
c. None of the options
O d. Provides link between depositors and
borrowers

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

Step 2

Step 3

Step 4

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Which of the following investment types cannot be sold during normal market hours? a) mutual fund b) cryptocurrency c) exchange traded fund
Which of the following regarding the investor sentiment theory of the closed end fund puzzle is FALSE? a) Investors in closed end funds are not as important an ownership group in the assets of the funds’ investment portfolios. b) The closed end fund is riskier than the underlying portfolio. c) Arbitrageurs are subject to limits to arbitrage. d) The noise trader risk is diversifiable.
Which of the following is true with Primary Market? Select one: a. None of the options b. Provides liquidity for instruments which are already issued by companies c. Deals with old stocks issued by companies d. Increases risk e. Needs fixed place for trading Which of the following is not a financial instrument? Select one: a. Merchant bankers b. Mutual Fund Companies c. All the options d. Banks e. Leasing Companies
Those financial markets that facilitate the flow of short-term funds are known as: Question 6 options: money markets capital markets derivative markets mortgage markets
The risk of default on the part of the importer—risk of noncompletion—is present as soon as: A) Private equity funds differ from traditional venture capital funds. List and discuss three differences between them.
With respect to hedge fund investing, the net return to an investor in a fund of funds would be lower than that earned from an individual hedge fund because of:a. Both the extra layer of fees and the higher liquidity offered.b. No reason; funds of funds earn returns that are equal to those of individual hedge funds.c. The extra layer of fees only.
Which of the following are the MAIN REASONS for an investor to invest in managed funds? I - To obtain a better return. II - To diversify risks. III - Lack of time to look after their own investments. IV - More freedom on stock selection. A) I, II and III only B) I, II and IV only C) I, III and IV only D) II, III and IV only
Which of the following is not the function of the secondary market Select one: a. Marketability to securities b. Liquidity of securities c. None of these d. It gurantees fixed rate of return to the investor
A) Which of the following is not the function of the secondary market Select one: a. Marketability to securities b. Liquidity of securities c. None of these d. It gurantees fixed rate of return to the investor B) Which of the following are short-term financial instruments? Select one: a. Share of Rysut cement b. None of these c. A bond with five years maturity d. A banker’s acceptance C) money market does not have any role in the development of capital market a. True b. False
The company wishes to mobilize short term funds through various sources, Which of the following is not an appropriate source for the company? Select one: A. Equity Shares B. Commercial Paper C. Treasury Bills D. Commercial Bills
The liability / equity side of an open-ended hedge fund is composed of __________________. A. units and margin loans B. units only C. the financial instruments described in the deeds D. Investment properties E. marketable shares
Which of the following is NOT an assumption used in deriving the Capital Asset Pricing Model (CAPM)? Investors can buy and sell all securities at competitive market prices without incurring taxes or transactions cost and can borrow and lend at the risk-free interest rate Investors hold only efficient portfolios of traded securities. Investors have homogeneous expectations regarding the volatilities, correlation, and expected returns of securities. Investors have homogeneous risk averse preferences toward taking on risk.