Financial instruments are assets that have a monetary value or record a monetary transaction. To coordinate the exchange of capital between borrowers and lenders, financial instruments trade in the financial markets. These financial instruments can be categorized on the basis of their issuers, maturity, risk, and other factors. Identify the financial instruments based on the following descriptions. Backed by the U.S. government, these financial instruments are short-term debt obligations with a maturity of less than one year. They are considered risk-free investments. State and local government bonds, U.S. Tresury, U.S. Tresury notes and bonds Issued by money-centered financial firms, these short- or medium-term insured debt instruments pay higher interest than a regular savings account. They are low-risk instruments and have low returns. Money Market Mutual Funds, Certificates of Deposit, Commercial Paper These financial instruments are investment pools that buy such short-term debt instruments as Treasury bills (T-bills), certificates of deposit (CDs), and commercial paper. They can be easily liquidated. Customer Credit, Money Market Mutual Funds, Commercial Paper These financial instruments are contractual agreements that give one party a long-term agreement to use an asset by providing regular payments. Leases, Coperate Bonds, Prefered Stocks
Financial instruments are assets that have a monetary value or record a monetary transaction. To coordinate the exchange of capital between borrowers and lenders, financial instruments trade in the financial markets. These financial instruments can be categorized on the basis of their issuers, maturity, risk, and other factors. Identify the financial instruments based on the following descriptions. Backed by the U.S. government, these financial instruments are short-term debt obligations with a maturity of less than one year. They are considered risk-free investments. State and local government bonds, U.S. Tresury, U.S. Tresury notes and bonds Issued by money-centered financial firms, these short- or medium-term insured debt instruments pay higher interest than a regular savings account. They are low-risk instruments and have low returns. Money Market Mutual Funds, Certificates of Deposit, Commercial Paper These financial instruments are investment pools that buy such short-term debt instruments as Treasury bills (T-bills), certificates of deposit (CDs), and commercial paper. They can be easily liquidated. Customer Credit, Money Market Mutual Funds, Commercial Paper These financial instruments are contractual agreements that give one party a long-term agreement to use an asset by providing regular payments. Leases, Coperate Bonds, Prefered Stocks
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
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Financial instruments are assets that have a monetary value or record a monetary transaction. To coordinate the exchange of capital between borrowers and lenders, financial instruments trade in the financial markets. These financial instruments can be categorized on the basis of their issuers, maturity, risk, and other factors.
Identify the financial instruments based on the following descriptions.
| Backed by the U.S. government, these financial instruments are short-term debt obligations with a maturity of less than one year. They are considered risk-free investments. | State and local government bonds, U.S. Tresury, U.S. Tresury notes and bonds |
| Issued by money-centered financial firms, these short- or medium-term insured debt instruments pay higher interest than a regular savings account. They are low-risk instruments and have low returns. | Money Market Mutual Funds, Certificates of Deposit, Commercial Paper |
| These financial instruments are investment pools that buy such short-term debt instruments as Treasury bills (T-bills), certificates of deposit (CDs), and commercial paper. They can be easily liquidated. | Customer Credit, Money Market Mutual Funds, Commercial Paper |
| These financial instruments are contractual agreements that give one party a long-term agreement to use an asset by providing regular payments. | Leases, Coperate Bonds, |
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