1. Compare the role of mutual funds with that of commercial banks as financial intermediaries. (5 marks) 2. Briefly describe the role of derivative securities and discuss their potential impact on market stability and systemic risk. (5 marks)
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- • Contrast the activities of securities firms from other financial institutions. How do these financial institutions differ from hedge funds?1) Financial markets may be categorized as? A). debt securities markets B). Equity securities markets C). Derivative securities markets D). Foreign exchange markets. Required : Please answer this question by choosing the correct option.Which of the following is most likely to expose the holders to counterparty credit risk? A. open-end mutual funds B. closed-end mutual funds C. ETNs D. ETFs
- 1. What is the money market (include in your answer the characteristics of the money market and the types of securities that are traded in the money market)?Which one of the following is NOT a 'Money Market Instrument'? Select one:a. Certificate of Depositb. Equity Sharesc. Commercial Paperd. Treasury Bills1. Which of the following is a function of every financial market? A) It determines the level of interest rates. B) It allows common stock to be traded. C) It allows loans to be made. D) It channels funds from lenders-savers to borrowers-spenders. 2. Securities are for the person who purchases them, but they are for the person/firm who sells them. A) assets; liabilities B) liabilities; assets C) income; liabilities D) liabilities; expenses 3. Which of the following is/are money market instrument(s)? A) Negotiable certificates of deposits B) Common stock C) T-bonds D) 4-year maturity corporate bond 4. Who has voting rights at a shareholders' meeting? A) All common stock owners. B) Common stock owners who own more than 1% of the company. C) Only the company's managers. D) All preferred stock owners. 5. These are investments where shareholders become the owners of the portfolio of the account. These portfolios of securities could be made up of equity securities or debt securities. A)…
- A.Discuss three factors that affect net interest income.B.What are the objectives of the Basel III liquidity standards?C.Discuss any five principles of bank liquidity risk management.D.What are the major advantages of financial derivatives for managing interest rate risk compared to the traditional gap and duration gap techniques?E.Why is the marginal cost of funds critical in loan pricing?Which of the following is a financial instrument? Select one: a. Merchant bankers b. Leasing Companies c. All the options d. Bonds e. Mutual Fund CompaniesWhich of the following represents broadest category of financial products that can be bought and sold? Which of the following represents broadest category of financial products that can be bought and sold? Equities Derivatives Securities Debt
- 1. Distinguish between the following pair of termsMoney Capital and Capital MarketsPrimary Markets and Secondary MarketsTreasury Bills and BondsStock Exchange Market and Over the Counter TradingWhich one of the following is not a money market securities. Choose correct option and explain and also explain incorrect options and also explain summary A•Treasury bills B•National savings certificate C•Certificate of deposit D•Commercial paper6. Which of the following types of investment carries the greatest risk? Stocks Bonds Mutual funds Certificates of deposit