,TEST j BANK j FOR
Financial jMarkets jAnd jInstitutions j8th jEdition jAnthony jSaunders
Chapter j1
Student jname:
1) What jfactors jare jencouraging jfinancial jinstitutions jto joffer joverlapping jfinancial
jservices jsuch jas jbanking, jinvestment jbanking, jbrokerage, jetc.? j 1.I. jRegulatory jchanges
jallowing jinstitutions jto joffer jmore jservices
2.II. jTechnological jimprovements jreducing jthe jcost jof jproviding jfinancial jservices
3.III. jIncreasing jcompetition jfrom jfull-service jglobal jfinancial jinstitutions
4.IV. jReduction jin jthe jneed jto jmanage jrisk jat jfinancial jinstitutions
A) I jonly
B) II jand jIII jonly
C) I, jII, jand jIII jonly
D) I, jII, jand jIV jonly
E) I, jII, jIII, jand jIV
2) IBM jcreates jand jsells jadditional jstock jto jthe jinvestment jbanker jMorgan jStanley.
jMorgan jStanley jthen jresells jthe jissue jto jthe jU.S. jpublic jthrough jits jmutual jfunds.
This jtransaction jis jan jexample jof ja(n):
A) primary jmarket jtransaction.
B) asset jtransformation jby jMorgan jStanley.
C) money jmarket jtransaction.
D) foreign jexchange jtransaction.
E) forward jtransaction.
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,3) IBM jcreates jand jsells jadditional jstock jto jthe jinvestment jbanker jMorgan jStanley.
jMorgan jStanley jthen jresells jthe jissue jto jthe jU.S. jpublic jthrough jits jmutual jfunds.
Morgan jStanley jis jacting jas ja(n)
A) asset jtransformer.
B) asset jbroker.
C) government jregulator.
D) foreign jservice jrepresentative.
E) derivatives jtrader.
4) A jcorporation jseeking jto jsell jnew jequity jsecurities jto jthe jpublic jfor jthe jfirst jtime jin
jorder jto jraise jcash jfor jcapital jinvestment jwould jmost jlikely:
A) conduct jan jIPO jwith jthe jassistance jof jan jinvestment jbanker.
B) engage jin ja jsecondary jmarket jsale jof jequity.
C) conduct ja jprivate jplacement jto ja jlarge jnumber jof jpotential jbuyers.
D) place jan jad jin jthe j j Wall jStreet jJournal jsoliciting jretail jsuppliers jof jfunds.
E) issue jbonds jwith jthe jassistance jof ja jdealer.
5) The jlargest jcapital jmarket jsecurity joutstanding jin j2019 jmeasured jby jmarket jvalue jwas:
A) securitized jmortgages.
B) corporate jbonds.
C) municipal jbonds.
D) Treasury jbonds.
E) corporate jstocks.
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, 6) The jdiagram jbelow jis ja jdiagram jof jthe:
A) secondary jmarkets.
B) primary jmarkets.
C) money jmarkets.
D) derivatives jmarkets.
E) commodities jmarkets.
7) and j allow ja jfinancial jintermediary jto joffer jsafe jliquid
jliabilities jsuch jas jdeposits jwhile jinvesting jthe jdepositors' jmoney jin jriskier jilliquid jassets.
A) Diversification; jhigh jequity jreturns
B) Price jrisk; jcollateral
C) Free jriders; jregulations
D) Monitoring; jdiversification
E) Primary jmarkets; jforeign jexchange jmarkets
8) Depository jinstitutions jinclude:
A) banks jonly.
B) thrifts jonly.
C) finance jcompanies jonly.
D) banks jand jthrifts.
E) All jof jthese jchoices jare jcorrect.
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