written by brilliantsmart
cha1
Student: ___________________________________________________________________________
1. In 2007, ____________ was the most significant real asset of U.S. households in terms of total value.
A. consumer durables
B. automobiles
C. real estate
D. mutual fund shares
E. bank loans
2. In 2007, ____________ was the least significant financial asset of U.S. households in terms of total value.
A. real estate
B. mutual fund shares
C. debt securities
D. life insurance reserves
E. pension reserves
3. In 2007, ____________ was the most significant asset of U.S. households in terms of total value.
A. real estate
B. mutual fund shares
C. debt securities
D. life insurance reserves
E. pension reserves
4. In 2007, ____________ was the most significant liability of U.S. households in terms of total value.
A. credit cards
B. mortgages
C. bank loans
D. student loans
E. other debt
5. The largest component of domestic net worth in 2007 was ____________.
A. non-residential real estate
B. residential real estate
C. inventories
D. consumer durables
E. equipment and software
6. In 2007, ____________ was the most significant real asset of U.S. nonfinancial businesses in terms of total
value.
A. equipment and software
B. inventory
C. real estate
D. trade credit
E. marketable securities
,written by brilliantsmart
7. In 2007, ____________ was the least significant real asset of U.S. nonfinancial businesses in terms of total
value.
A. equipment and software
B. inventory
C. real estate
D. trade credit
E. marketable securities
8. In 2007, ____________ was the least significant liability of U.S. nonfinancial businesses in terms of total
value.
A. bonds and mortgages
B. bank loans
C. inventories
D. trade debt
E. marketable securities
9. In terms of total value, the most significant liability of U.S. nonfinancial businesses in 2007 was _______.
A. bank loans
B. bonds and mortgages
C. trade debt
D. other loans
E. marketable securities.
10. In 2007, ____________ was the most significant financial asset of U.S. nonfinancial businesses in terms of
total value.
A. cash
B. trade credit
C. trade debt
D. inventory
E. marketable securities
11. The material wealth of a society is equal to the sum of _________.
A. all financial assets
B. all real assets
C. all financial and real assets
D. all physical assets
E. none of the above
12. ____________ of an investment bank.
A. Citigroup is an example
B. Merrill Lynch is an example
C. Goldman is an example
D. B and C are each examples
E. Each of the above is an example
,written by brilliantsmart
13. _______ are financial assets.
A. Bonds
B. Machines
C. Stocks
D. A and C
E. A, B and C
14. An example of a derivative security is ______.
A. a common share of General Motors
B. a call option on Mobil stock
C. a commodity futures contract
D. B and C
E. A and B
15. _______ was the first to introduce mortgage pass-through securities.
A. Chase Manhattan
B. Citicorp
C. FNMA
D. GNMA
E. None of the above
16. A bond issue is broken up so that some investors will receive only interest payments while others will
receive only principal payments, which is an example of ________.
A. bundling
B. credit enhancement
C. unbundling
D. financial engineering
E. C and D
17. An example of a primitive security is __________.
A. a common share of General Motors
B. a call option on Mobil stock
C. a call option on a stock of a firm based in a Third World country
D. a U.S. government bond
E. A and D
18. The ____________ refers to the potential conflict between management and shareholders due to
management's control of pecuniary rewards as well as the possibility of incompetent performance by
managers.
A. agency problem
B. diversification problem
C. liquidity problem
D. solvency problem
E. regulatory problem
, written by brilliantsmart
19. _________ financial asset(s).
A. Buildings are
B. Land is a
C. Derivatives are
D. U.S. Agency bonds are
E. C and D
20. The value of a derivative security _______.
A. depends on the value of the related primitive security
B. can only cause increased risk.
C. is unrelated to the value of the related primitive security
D. has been enhanced due the recent misuse and negative publicity regarding these instruments
E. is worthless today
21. Money market funds were a financial innovation partly inspired to circumvent _______.
A. Regulation B, which is still in existence
B. Regulation D
C. DIDMCA
D. Regulation M
E. Regulation Q, which is no longer in existence
22. __________ are a way U.S. investor can invest in foreign companies.
A. ADRs
B. IRAs
C. SDRs
D. GNMAs
E. Krugerrands
23. _______ are examples of financial intermediaries.
A. Commercial banks
B. Insurance companies
C. Investment companies
D. Credit unions
E. All of the above
24. Financial intermediaries exist because small investors cannot efficiently ________.
A. diversify their portfolios
B. gather all relevant information
C. assess credit risk of borrowers
D. advertise for needed investments
E. all of the above.
cha1
Student: ___________________________________________________________________________
1. In 2007, ____________ was the most significant real asset of U.S. households in terms of total value.
A. consumer durables
B. automobiles
C. real estate
D. mutual fund shares
E. bank loans
2. In 2007, ____________ was the least significant financial asset of U.S. households in terms of total value.
A. real estate
B. mutual fund shares
C. debt securities
D. life insurance reserves
E. pension reserves
3. In 2007, ____________ was the most significant asset of U.S. households in terms of total value.
A. real estate
B. mutual fund shares
C. debt securities
D. life insurance reserves
E. pension reserves
4. In 2007, ____________ was the most significant liability of U.S. households in terms of total value.
A. credit cards
B. mortgages
C. bank loans
D. student loans
E. other debt
5. The largest component of domestic net worth in 2007 was ____________.
A. non-residential real estate
B. residential real estate
C. inventories
D. consumer durables
E. equipment and software
6. In 2007, ____________ was the most significant real asset of U.S. nonfinancial businesses in terms of total
value.
A. equipment and software
B. inventory
C. real estate
D. trade credit
E. marketable securities
,written by brilliantsmart
7. In 2007, ____________ was the least significant real asset of U.S. nonfinancial businesses in terms of total
value.
A. equipment and software
B. inventory
C. real estate
D. trade credit
E. marketable securities
8. In 2007, ____________ was the least significant liability of U.S. nonfinancial businesses in terms of total
value.
A. bonds and mortgages
B. bank loans
C. inventories
D. trade debt
E. marketable securities
9. In terms of total value, the most significant liability of U.S. nonfinancial businesses in 2007 was _______.
A. bank loans
B. bonds and mortgages
C. trade debt
D. other loans
E. marketable securities.
10. In 2007, ____________ was the most significant financial asset of U.S. nonfinancial businesses in terms of
total value.
A. cash
B. trade credit
C. trade debt
D. inventory
E. marketable securities
11. The material wealth of a society is equal to the sum of _________.
A. all financial assets
B. all real assets
C. all financial and real assets
D. all physical assets
E. none of the above
12. ____________ of an investment bank.
A. Citigroup is an example
B. Merrill Lynch is an example
C. Goldman is an example
D. B and C are each examples
E. Each of the above is an example
,written by brilliantsmart
13. _______ are financial assets.
A. Bonds
B. Machines
C. Stocks
D. A and C
E. A, B and C
14. An example of a derivative security is ______.
A. a common share of General Motors
B. a call option on Mobil stock
C. a commodity futures contract
D. B and C
E. A and B
15. _______ was the first to introduce mortgage pass-through securities.
A. Chase Manhattan
B. Citicorp
C. FNMA
D. GNMA
E. None of the above
16. A bond issue is broken up so that some investors will receive only interest payments while others will
receive only principal payments, which is an example of ________.
A. bundling
B. credit enhancement
C. unbundling
D. financial engineering
E. C and D
17. An example of a primitive security is __________.
A. a common share of General Motors
B. a call option on Mobil stock
C. a call option on a stock of a firm based in a Third World country
D. a U.S. government bond
E. A and D
18. The ____________ refers to the potential conflict between management and shareholders due to
management's control of pecuniary rewards as well as the possibility of incompetent performance by
managers.
A. agency problem
B. diversification problem
C. liquidity problem
D. solvency problem
E. regulatory problem
, written by brilliantsmart
19. _________ financial asset(s).
A. Buildings are
B. Land is a
C. Derivatives are
D. U.S. Agency bonds are
E. C and D
20. The value of a derivative security _______.
A. depends on the value of the related primitive security
B. can only cause increased risk.
C. is unrelated to the value of the related primitive security
D. has been enhanced due the recent misuse and negative publicity regarding these instruments
E. is worthless today
21. Money market funds were a financial innovation partly inspired to circumvent _______.
A. Regulation B, which is still in existence
B. Regulation D
C. DIDMCA
D. Regulation M
E. Regulation Q, which is no longer in existence
22. __________ are a way U.S. investor can invest in foreign companies.
A. ADRs
B. IRAs
C. SDRs
D. GNMAs
E. Krugerrands
23. _______ are examples of financial intermediaries.
A. Commercial banks
B. Insurance companies
C. Investment companies
D. Credit unions
E. All of the above
24. Financial intermediaries exist because small investors cannot efficiently ________.
A. diversify their portfolios
B. gather all relevant information
C. assess credit risk of borrowers
D. advertise for needed investments
E. all of the above.
