Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Answer question 13, is it true or false
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O Hak Cipta Universiti Teknologi MARA
You
NURUL AINA
+2
CONFIDENTIAL 5 BA/FEB2022/FIN435
SECTION B (TRUE/FALSE)
Financial markets include the capital markets which mainly deal in short-term
financial assets.
1.
(True/False)
Interest rates on banker's acceptances are low because the risk of default is very low.
(True/False)
2.
Liquidity risk is the risk where the borrowers not being able to repay the loan leading
to banks suffer the losses.
3.
(True/False)
Transaction risk happens when there is a default payment on the delivery date by one
party, causing another party to incur losses
4.
(True/False)
Labuan FSA is the statutory body responsible for the development and
administration of the Labuan International Business and Financial Centre
5.
(True/False)
Intermediaries who are agents of investors and match buyers with sellers of
securities are called brokers
6.
(True/False)
Money markets are referred to as retail markets because small individual investors
are the primary buyers of money market securities
7.
(True/False)
8.
Non-Bank Financial Institutions (NBFIS) are part of the financial institutions in the
intermediation process and their roles are specialized in nature such as pension fund,
providing insurance business, promoting economic activities for economic
development, credit institution, and others.
(True/False)
9.
Secured Loan is refers to loans not backed by any assets (clean basis) and lender
has first claim upon default payment.
(True/False)
10.
Interest rates are important to financial institutions since an interest rate increase
will decrease the cost of acquiring funds and increase the income from assets.
(True/False)
11.
Ability to meet commitments is one of the example of red flags.
(True/False)
12.
Cash deposit machines will provide facilities to deposit money to own account, third
party accounts and cash payment through online transaction.
(True/False)
13.
The real interest rate is equal to the nominal rate minus inflation
(True/False)
O Hak Cipta Universiti Teknologi MARA
CONFIDENTIAL
CONFIDENTIAL 6 BA/FEB2022/FIN435
Al-Mudharabah (investment) conceAti a contract made between provide of capital
(depositor) and an entrepreneur cr fund manager (the Bank) to enable the bank to
carry out business ventures within the Shariah guidelines.
14.
(True/False)
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