Bpi family bank has no commitment to advance funds on

24) BPI Family bank has no commitment to advance funds on demand by the party
to whom the draft was directed.
a) TRUE
b) FALSE
25) When loans must be repaid in foreign currencies, there will be no risk anymore.
This is because the currency is already locked up to its value upon exchange. Even if
exchange rates change, the equivalent of the currency borrowed will remain its value.

b) FALSE
26) The service that the financial system offers where it provides ease with which an
asset can be exchanged for money which savers can view as a benefit.
27) What is the effect when financial system provides risk sharing by allowing
savers to hold many assets.
28) Over the past few decades, changing technology and improving communications
have increased tariffs and has limited the scope and efficiency of the global financial
system.
a) TRUE
b) FALSE
29) The main task of a financial system
30) Two problems arising from asymmetric information

MONEY MARKET SECURITIES
Financial Markets
Post Test No. 2
1) Everything else equal, an effective annual rate will be greater than the bond
equivalent yield on the same security.
2) Money markets exist to help reduce the opportunity cost of holding cash balances.
a) TRUE
b) FALSE
3) The majority of money market securities are low-denomination, low-risk investments
designed to appeal to individual investors with excess cash.
4) Commercial paper is a short-term obligation of the U.S. government issued to cover
government budget deficits and to refinance maturing government debt.
5) Commercial paper, Treasury bills, and banker's acceptance rates are all quoted as
discount yields.
6) Fed funds are short-term unsecured loans while repos are short-term secured loans.
a) True
b) False