financequiz4 - 1 Question Money markets are markets for...

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1. Question: Money markets are markets for
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Your Answer: Fore ign curre ncies . ( ) Cons umer auto mobi le loan s. Corp orate stoc ks. Lon g- term bond s. Shor t-
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Instructor Explanation: See page 145 of the text. Points Received: 4 of 4 Comments: 2. Question: Which of the following statements is CORRECT?
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Your Answer: The most impo rtant diffe renc e betw een spot mark ets vers us futur es mark ets is the matu rity of the instr ume nts that are trade d. Spot mark et trans actio ns invol ve secu rities that have matu rities
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Instructor Explanation: Capital market transactions involve any long-term debt or equity instrument. If a company sells stock to directly raise money for the firm, this is a primary market transaction, even if the company already has stock outstanding. Money market transactions can be denominated in any currency. They are merely very short-term, highly liquid securities. Therefore, the only correct answer is “d” – both Nasdaq dealers and NYSE specialists hold inventories of stocks. Points Received: 4 of 4 Comments: 3. Question: If the stock market is semistrong-form efficient, which of the following statements would be CORRECT?
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Your Answer: The requi red retur ns on all stoc ks are the same , and the requi red retur ns on stoc ks are high er than the requi red retur ns on bond s.
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