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Capital Markets
Quiz 3
Solution
Q.1.
A trader use borrowed funds from a broker for purchasing securities. State which type of trading is this?
Debt trading
Lease trading
Margin trading
Hire purchasing
Q.2.
_______ is an agreement to buy or sell at a specific date in the future at a predetermined price
equities
futures contract
bond
savings
Q.3.
_______ stocks that represent ownership shares in corporations
equities
capital market
secondary market
futures contract
Q.4.
_______ the dollars that become available for investors to use when others refrain from consuming
risk
equities
bond
savings
Q.5.
_______ a market in which all financial assets can be sold to someone other than the original issuer
primary market
secondary market
financial system
capital market
Q.6.
_______ a market in which financial capital is loaned and/or borrowed for at least one year
primary market
secondary market
financial system
capital market
Q.7.
_______ a strategy of holding different kinds of investments to minimize risk
portfolio diversification
bond
futures contract
risk
Q.8.
_______ a market in which only the original issuer can sell or repurchase a financial asset
financial system
primary market
capital market
secondary market
Q.9.
The rate of return on a corporate, municipal, or government bond is its _______ .
par value
compensation rate
interest rate
coupon rate
Q.10.
Junk bonds usually have low ratings because _______ .
they have a low rate of return
they have a low risk of default
they are not risky investments
they are a high-risk investment
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