Eurodollars are U.S. dollars that have been deposited in foreign branches of U.S

Question

Eurodollars are U.S. dollars that have been deposited in

foreign branches of U.S. banks

foreign subsidiaries

foreign banks

foreign banks and foreign branches of U.S. banks

10 points   

QUESTION 2

A savings and loan association is an example of which type of financial intermediary?

commercial bank

investment company

finance company

thrift institution

10 points   

QUESTION 3

Finance companies obtain a significant amount of their funds by

pooling funds

issuing their own debt securities

issuing their own equity securities

accepting both demand and time deposits

10 points   

QUESTION 4

When an investor purchases shares in a no-load common stock mutual fund, she is using a(n)

primary intermediary

broker

financial intermediary

over-the-counter market

10 points   

QUESTION 5

In an efficient capital market, corporate diversification is ____.

of great benefit

inexpensive

unnecessary

of benefit to corporate managers

10 points   

QUESTION 6

Changes in the tax code that slow down depreciation, ____ the present value of investment cash flows and, therefore, make the investment ____ desirable.

increase, more

increase, less

decrease, less

decrease, more

10 points   

QUESTION 7

Christy purchased 100 shares of Good Idea stock for $48 last year. Yesterday she sold the stock for $45. If she received $4 in dividends during the time she held the security, what is her holding period return?

-6.30%

14.60%

8.30%

2.08%

10 points   

QUESTION 8

Lear purchased 100 shares of Quitcha Twitchin Anti-inch Cream stock at $30 per share last year and sold them eleven months later for $24 per share. The shares split 2 for 1 shortly after Lear purchased the stock. If the stock paid $0.25 per share in dividends last year, what is Lear's holding period return?

6.17%

61.67%

21.67%

-19.17%

10 points   

QUESTION 9

All of the following are financial intermediaries EXCEPT:

loan sharks

commercial banks

investment companies

thrift institutions

10 points   

QUESTION 10

Trading on the NYSE is conducted by members of the exchange. The members that execute orders and act as agents on behalf of their clients are::

Floor Brokers

SEC Agents

Exchange Runners

Designated Market Makers

10 points   

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a.

foreign branches of U.S. banks

b.

foreign subsidiaries

c.

foreign banks

d.

foreign banks and foreign branches of U.S. banks

Explanation / Answer

Q1.

Correct Answer:

d. foreign banks and foreign branches of U.S. banks

Explanation:

Eurodollars are considered as type of deposits that is termed as time deposits. It is used to avoid regulations of US federal reserve system thus it is used by the above mentioned banks.

Q2.

Correct Answer:

a. commercial banks

Explanation:

It is the commercial bank’s work to accept savings from depositors and issuing loans to people.

Q3.

Correct Answer:

b. issuing their own debt securities

Explanation:

One of its examples is issue of certificates of deposits.

Q4.

Correct Answer:

c. Financial Intermediary

Explanation:

It is the financial intermediary that facilitates the purchase of shares in mutual funds by an investor.

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