EBK INVESTMENTS
11th Edition
ISBN: 9781259357480
Author: Bodie
Publisher: MCGRAW HILL BOOK COMPANY
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Question
Chapter 3, Problem 3CP
Summary Introduction
To select: The correct option.
Introduction: The specialist on the New York Stock Exchange helps to maintain the equilibrium in the market by performing the different role such as auctioneer, catalyst and agent.
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Transactions involving buying and selling securities are conducted through stockbrokers, who are also known as account executives or financial consultants. When choosing a stockbroker, investors have three primary options: full-service brokers, discount brokers, and online brokers.
Brokers who offer a complete array of services such as advisory services along with executing client’s transactions are called .
While some brokers still operate exclusively in person or online, the distinction between the three types has become increasingly over the years. The chart that follows shows fees imposed by different discount brokers; as you can see, of them offer both online and broker-assisted trades.
Broker
ShareCo
AmeriTrading
TradeBuilder
ShareFunder
eExchange
Commission for Online Trades
Market Order Price
$7.95
$9.99
$7.95
$9.95
$9.99
Limit Order Price
$7.95
$9.99
$7.95
$9.95
$9.99
Commission for Broker-Assisted Trades…
It safeguards the investing public against losses in case of fraud, failure or insolvency of brokers and dealers who are members of the exchange.
a. alert levels
b, Phil. Stock Exchange
c. Securities Investor Protection fund Inc.
d. Dow Jones Industrial Average
ICICIDirect is the first service in India to provide complete end-to-end integration for seamless electronic trading on the stock exchanges. This service will enable the user to tie- in his trading bank account and his demat account to your brokerage account electronically.This integration of brokerage ,demat and bank accounts ensures that money is transferred to/from the user bank account and the shares are transferred from/to his demat account automatically without any paperwork.ICICIDirect keeps track of the transactions ,the settlement dates, and stock exchange rules.How is the web in this case enhances the convenience of customers ?Derive the business model of ICICIDirect in this case.
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- An important financial institution that assists in the initial sale of securities in the primary market is the investment bank. commercial bank. stock exchange. stock broker.arrow_forwardICICIDirect is the first service in India to provide complete end-to-end integration forseamless electronic trading on the stock exchanges. This service will enable the user totie- in his trading bank account and his demat account to your brokerage accountelectronically. This integration of brokerage,demat and bank accounts ensures thatmoney is transferred to/from the user bank account and the shares are transferredfrom/to his demat account automatically without any paperwork.ICICIDirect keeps trackof the transactions, the settlement dates, and stock exchange rules.How is the web in this case enhances the convenience of customers? Derive the businessmodel of ICICIDirect in this case.arrow_forwardCorrespondent banking may involve Select one: a. Providing banking services to other banks facing shortage of staff. b. Acting as transfer and disbursement agents for pension funds. c. Providing foreign exchange trading services to individuals. d. Providing hedging services to corporations. e. Holding and managing assets for individuals or corporations.arrow_forward
- Arrange the following information on Bank X into its income statement. Label and place each item in the appropriate category, in the appropriate order. Commission ,exchange and brokerage received.Income on InvestmentsInterest paid on depositsPayments to and provisions for employeesInterest paid on BBI/ interbank borrowingsInterest/discount received on advances/billsIncome from leasing/hire purchaseInterest paid-othersProfit on exchange transactionsRent, taxes, lightingInsuranceLaw chargesProfit on sale of land, buildings and other assetsMiscellaneous incomeAuditor’s fees and expensesPrinting and stationaryProfit on sale of investmentsDepreciation on bank’s propertyIncome by way of dividends and subsidiariesAdvertisement and PublicityInterest earned – othersDirector’s fees, allowances and expensesMiscellaneous incomeRepairs and maintenanceOther expensesPostage, telegram, telephone and other communication expensesInterest received on balances with RBI and interbank fundsarrow_forwardIncorporate the following data into Bank X's revenue statement. Each item should be labelled and placed in the proper category and order. Commission ,exchange and brokerage received.Income on InvestmentsInterest paid on depositsPayments to and provisions for employeesInterest paid on BBI/ interbank borrowingsInterest/discount received on advances/billsIncome from leasing/hire purchaseInterest paid-othersProfit on exchange transactionsRent, taxes, lightingInsuranceLaw chargesProfit on sale of land, buildings and other assetsMiscellaneous incomeAuditor’s fees and expensesPrinting and stationaryProfit on sale of investmentsDepreciation on bank’s propertyIncome by way of dividends and subsidiariesAdvertisement and PublicityInterest earned – othersDirector’s fees, allowances and expensesMiscellaneous incomeRepairs and maintenanceOther expensesPostage, telegram, telephone and other communication expensesInterest received on balances with RBI and interbank funds.arrow_forward6. Stock market regulation Use the following table to match each term to its corresponding description. Description Restrictions on trading when exchanges believe market participants need more time to gather complete information about a stock. The agency that attempts to protect investors by ensuring firms fully disclose all relevant information that could affect the values of securities. The division that reviews security trades by various organizations that facilitate the trading of securities, such as brokers and stock exchanges. Regulation that requires that investors receive important information about securities being offered on public exchanges and prohibits misleading or unethical trading practices on security exchanges by requiring stock exchanges to discipline financial market participants who violate the regulation. Term Circuit Breakers Sarbanes-Oxley Act of 2002 Securities and Exchange Acts of 1933 and 1934 Trading Haltsarrow_forward
- When a company decides to extend credit to consumers, it is making an investment decision in: a. Trade Credit b. Accounts Receivables c. Inventories d. Marketable Securitiesarrow_forwardQuestion: What is the source documents for Payment made by the business X. option: a) invoice received by the business X. b) invoice issued by the business X. c) Receipts received by the business X. d) Receipts issued by the business X. e) Bank Debit advice. f) Bank credit advice. g) internal memo. h) cash sales slip. i) Cheque butt. J) credit note issued by business X. reqiured: Please answer this question by choosing the right option.arrow_forwardA lockbox plan is A. A method for safe-keeping of marketable securities. B. Used to identify inventory safety stocks. C. A system for slowing down the collection of checks written by a firm. D. A system for speeding up a firm?s collections of checks received. E. Not described by any of the statements above.arrow_forward
- Explain the trade credit facility provided by some companies to their customers that allow them to manage their day-to-day liquidity situation and calculate the opportunity cost of an invoice that specifies the following conditions, as shown below (a. – c.):a) conditions: 1.25/10, n/30.b) conditions: 1.25/10, n/60.c) conditions: 1.5/10, n/60.arrow_forwardKnowledge Check 01 Identify the type of activity by choosing the best answer for each question. Select each item listed below as being an identifying, recording, or a communicating activity. Items Preparing and entering a list of checks issued. Using a cash register to enter sales. Entering a list of the sales invoices, including the prices and quantities, for the company's recordke Interpreting information from financial reports. Preparing financial statements for creditors.arrow_forwardExamples of off-balance-sheet activities include foreign exchange market transactions. Oborrowing from other banks. O extending loans to depositors. discount window operations.arrow_forward
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