practicemidtermw120

# practicemidtermw120 - STUDENT NAME(Please Print Clearly...

This preview shows pages 1–3. Sign up to view the full content.

STUDENT NAME: __________________________________ (Please Print Clearly) STUDENT NUMBER: ___________________ McGill University Desautels Faculty of Management FINE 442 MID-TERM EXAMINATION Professor Larbi Hammami INSTRUCTIONS: 1. Write your name and student number in the space provided above. 2. Please outline solutions and indicate intermediate steps and calculations. Partial credit will be awarded if you provide sufficient evidence of approaching the problem correctly. 3. Notes or texts are not allowed. Dictionaries and calculators are permitted. TOTAL PAGES : 6 pages

This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document
MULTIPLE CHOICE- [ 10 marks - 1 mark each] Circle the right answer 1) Every financial market has the following characteristic: A) It determines the level of interest rates. B) It allows bond to be traded. C) It allows loans to be made. D) It channels fund. E) All of the above. 2) Which of the following can be described as involving direct finance? A) A corporation’s stock is traded in an over-the-counter market. B) People buy shares in a mutual fund. C) A pension fund manager buys commercial paper in the secondary market. D) An insurance company buys shares of common stock in the over-the-countermarkets. E) None of the above. 3) In which of the following situations would you prefer to be borrowing? A) The interest rate is 9 percent and the expected inflation rate is 7 percent. B) The interest rate is 4 percent and the expected inflation rate is 1 percent. C) The interest rate is 13 percent and the expected inflation rate is 15 percent. D) The interest rate is 25 percent and the expected inflation rate is 50 percent. 4) Assume that the reserve requirement ratio is 12 percent and that the Bank of Canada uses open market
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

### Page1 / 6

practicemidtermw120 - STUDENT NAME(Please Print Clearly...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document
Ask a homework question - tutors are online