TEST BANK for Financial Markets and Institutions 8th Edition by Saunders and Erhemjamts all chapters 1-25 covered

TEST BANK FORt t




Financial Markets And Institutions 8th Edition Anthony Saunders
t t t t t t t




Chapter 1t




Student name:t




1) Whattfactorstaretencouragingtfinancialtinstitutionsttotoffertoverlappingtfinancialtservicestsuc
htastbanking,tinvestmenttbanking,tbrokerage,tetc.?t 1.I.tRegulatorytchangestallowingtinstitutionsttot
offertmoretservices
2.II.tTechnologicaltimprovementstreducingtthetcosttoftprovidingtfinancialtservices
3.III.tIncreasingtcompetitiontfromtfull-servicetglobaltfinancialtinstitutions
4.IV.tReductiontintthetneedttotmanagetrisktattfinancialtinstitutions



A) Itonly
B) IItandtIIItonly
C) I,tII,tandtIIItonly
D) I,tII,tandtIVtonly
E) I,tII,tIII,tandtIV




2) IBMtcreatestandtsellstadditionaltstockttotthetinvestmenttbankertMorgantStanley.tMorgantSta
nleytthentresellstthetissuettotthetU.S.tpublictthroughtitstmutualtfunds.

Thisttransactiontistantexampletofta(n):

A) primarytmarketttransaction.
B) assetttransformationtbytMorgantStanley.
C) moneytmarketttransaction.
D) foreigntexchangettransaction.
E) forwardttransaction.




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,3) IBMtcreatestandtsellstadditionaltstockttotthetinvestmenttbankertMorgantStanley.tMorgantSta
nleytthentresellstthetissuettotthetU.S.tpublictthroughtitstmutualtfunds.

MorgantStanleytistactingtasta(n)


A) assetttransformer.
B) assettbroker.
C) governmenttregulator.
D) foreigntservicetrepresentative.
E) derivativesttrader.




4) Atcorporationtseekingttotselltnewtequitytsecuritiesttotthetpublictfortthetfirstttimetintorderttotrai
setcashtfortcapitaltinvestmenttwouldtmosttlikely:


A) conducttantIPOtwithtthetassistancetoftantinvestmenttbanker.
B) engagetintatsecondarytmarkettsaletoftequity.
C) conducttatprivatetplacementttotatlargetnumbertoftpotentialtbuyers.
D) placetantadtintthet t WalltStreettJournaltsolicitingtretailtsupplierstoftfunds.
E) issuetbondstwithtthetassistancetoftatdealer.




5) Thetlargesttcapitaltmarkettsecuritytoutstandingtint2019tmeasuredtbytmarkettvaluetwas:


A) securitizedtmortgages.
B) corporatetbonds.
C) municipaltbonds.
D) Treasurytbonds.
E) corporatetstocks.




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,6) Thetdiagramtbelowtistatdiagramtoftthe:




A) secondarytmarkets.
B) primarytmarkets.
C) moneytmarkets.
D) derivativestmarkets.
E) commoditiestmarkets.




7) andt
allowtatfinancialtintermediaryttotoffertsafetliquidtliabilitiestsuchtastdepositstwhiletinvestingtt
hetdepositors'tmoneytintriskiertilliquidtassets.


A) Diversification;thightequitytreturns
B) Pricetrisk;tcollateral
C) Freetriders;tregulations
D) Monitoring;tdiversification
E) Primarytmarkets;tforeigntexchangetmarkets




8) Depositorytinstitutionstinclude:


A) bankstonly.
B) thriftstonly.
C) financetcompaniestonly.
D) bankstandtthrifts.
E) Alltoftthesetchoicestaretcorrect.




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, 9) Matchtthetintermediarytwithtthetcharacteristictthattbesttdescribestitstfunction.t 1.I.tPro
videtprotectiontfromtadversetevents
2.II.tPooltfundstoftsmalltsaverstandtinvesttinteithertmoneytortcapitaltmarkets
3.III.tProvidetconsumertloanstandtrealtestatetloanstfundedtbytdeposits
4.IV.tAccumulatetandttransfertwealthtfromtworktperiodttotretirementtperiod
5.V.tUnderwritetandttradetsecuritiestandtprovidetbrokeragetservices
1. Thriftst2
.Insurers
3. Pensiontfunds
4. Securitiestfirmstandtinvestmenttbanks
5. Mutualtfunds




A) 1,t3,t2,t5,t4
B) 4,t2,t3,t5,t1
C) 2,t5,t1,t3,t4
D) 2,t4,t5,t3,t1
E) 5,t1,t3,t2,t4




10) Secondarytmarketsthelptsupporttprimarytmarketstbecausetsecondarytmarkets:t 1.I.toffertpri
marytmarkettpurchaserstliquiditytforttheirtholdings.
2. II.tupdatetthetpricetortvaluetoftthetprimarytmarkettclaims.
3. III.treducetthetcosttofttradingtthetprimarytmarkett claims.




A) Itonly
B) IItonly
C) ItandtIItonly
D) IItandtIIItonly
E) I,tII,tandtIII




11) Financialtintermediariest(FIs)tcantoffertsaverstatsafer,tmoretliquidtinvestmenttthantatcapi
taltmarkettsecurity,teventthoughtthetintermediarytinveststintriskytilliquidtinstrumentstbecause:



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