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Money Markets and Securities

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Questions and Answers

Which type of market trades debt securities or instruments with maturities of less than one year?

Capital market
Money market (correct)
Stock market
Foreign exchange market

What is the main purpose of capital markets?

To issue Treasury securities
To cater to longer-term investments and borrowing needs
To serve participants with excess funds to invest for periods longer than one year (correct)
To trade short-term debt instruments

What type of instruments trade in active secondary markets?

Stock market instruments
Capital market instruments
Foreign exchange instruments
Money market instruments (correct)

What are secondary money markets vital for?

Reallocating available liquid funds (D) Signup and view all the answers

Which market involves short-term debt instruments purchased by those with excess funds?

Money market (D) Signup and view all the answers

Which one of these is NOT a learning goal for Chapter 5?

Examine the process used to issue Treasury securities (C) Signup and view all the answers

Which one of these is NOT a characteristic of money markets?

Cater to longer-term investments and borrowing needs (B) Signup and view all the answers

Which one of these is a key participant in money markets?

Individual investors (D) Signup and view all the answers

Which one of these statements about secondary money markets is true?

They are vital for reallocating available liquid funds (B) Signup and view all the answers

Which one of these is NOT a purpose of capital markets?

Trade debt securities with maturities of less than one year (A) Signup and view all the answers

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