Podcast
Questions and Answers
What is the main difference between a debt instrument and an equity instrument?
What is the main difference between a debt instrument and an equity instrument?
- Debt instruments pay interest, while equities pay dividends.
- Debt instruments are riskier than equities.
- Debt instruments have a maturity date, while equities do not. (correct)
- Debt instruments are issued by the government, while equities are issued by private companies.
What is the term used to describe an equity holder?
What is the term used to describe an equity holder?
- Shareholder
- Residual claimant (correct)
- Creditor
- Debtor
What is the definition of a short-term debt instrument?
What is the definition of a short-term debt instrument?
- A debt instrument with a maturity of 1-10 years.
- A debt instrument with a maturity of less than 1 year. (correct)
- A debt instrument with a maturity of 10 years or longer.
- A debt instrument that pays interest at regular intervals.
What is the main advantage of owning a corporation's debt over its equity?
What is the main advantage of owning a corporation's debt over its equity?
What is the definition of an intermediate-term debt instrument?
What is the definition of an intermediate-term debt instrument?
Which of the following is NOT a type of debt instrument mentioned in the text?
Which of the following is NOT a type of debt instrument mentioned in the text?
What is the main function of brokers in the securities market?
What is the main function of brokers in the securities market?
How does a corporation acquire new funds?
How does a corporation acquire new funds?
What happens when an individual buys a security in the secondary market?
What happens when an individual buys a security in the secondary market?
Why do secondary markets make financial instruments more liquid?
Why do secondary markets make financial instruments more liquid?
How do conditions in the secondary market affect the primary market price of securities?
How do conditions in the secondary market affect the primary market price of securities?
Which market is most relevant to corporations issuing securities?
Which market is most relevant to corporations issuing securities?
What are money market securities characterized by?
What are money market securities characterized by?
Which entities actively use the money market to earn interest on temporary surplus funds?
Which entities actively use the money market to earn interest on temporary surplus funds?
What type of securities are often held by financial intermediaries like insurance companies and pension funds?
What type of securities are often held by financial intermediaries like insurance companies and pension funds?
What is the term used to describe the process of indirect finance involving financial intermediaries?
What is the term used to describe the process of indirect finance involving financial intermediaries?
Which source of financing is more important for corporations than securities markets?
Which source of financing is more important for corporations than securities markets?
What is the primary route for moving funds from lenders to borrowers?
What is the primary route for moving funds from lenders to borrowers?
What is the primary objective of the Bangko Sentral ng Pilipinas?
What is the primary objective of the Bangko Sentral ng Pilipinas?
Which of the following international entities is mentioned in the text as influencing the financial system?
Which of the following international entities is mentioned in the text as influencing the financial system?
What is the key role played by commercial banks in the financial system?
What is the key role played by commercial banks in the financial system?
What is the relationship between the Bangko Sentral ng Pilipinas and the financial system?
What is the relationship between the Bangko Sentral ng Pilipinas and the financial system?
How does the Bangko Sentral ng Pilipinas influence the financial system?
How does the Bangko Sentral ng Pilipinas influence the financial system?
What is the role of commercial banks in the financial system?
What is the role of commercial banks in the financial system?
What is the main advantage of financial intermediaries in reducing transaction costs?
What is the main advantage of financial intermediaries in reducing transaction costs?
How do financial intermediaries benefit individuals with excess funds to lend?
How do financial intermediaries benefit individuals with excess funds to lend?
What is an example of a liquidity service provided by financial intermediaries?
What is an example of a liquidity service provided by financial intermediaries?
How do financial intermediaries help reduce the exposure of investors to risk?
How do financial intermediaries help reduce the exposure of investors to risk?
What is the term used to describe the reduction in transaction costs as the size of a transaction increases?
What is the term used to describe the reduction in transaction costs as the size of a transaction increases?
What is the main problem faced by individuals with excess funds to lend, which financial intermediaries help solve?
What is the main problem faced by individuals with excess funds to lend, which financial intermediaries help solve?
