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1、Chapter 7 The Money Markets 7.1 Multiple Choice1) Activity in money markets increased significantly in the late 1970s and early 1980s because of A) rising short-term interest rates. B) regulations that limited what banks could pay for deposits. C) both A and B. D) neither (a) nor (b). 2) Money marke

2、t securities have all the following characteristics except they are not A) short term. B) money. C) low risk. D) very liquid. 3) Money market instruments A) are usually sold in large denominations. B) have low default risk. C) mature in one year or less. D) are characterized by all of the above. E)

3、are characterized by only A and B of the above. 4) The banking industry A) should have an efficiency advantage in gathering information that would eliminate the need for the money markets. B) exists primarily to mediate the asymmetric information problem between saver-lenders and borrower-spenders.

4、C) is subject to more regulations and governmental costs than are the money markets. D) all of the above are true. E) only A and B of the above are true. 5) In situations where asymmetric information problems are not severe, A) the money markets have a distinct cost advantage over banks in providing

5、 short-term funds. B) the money markets have a distinct cost advantage over banks in providing long-term funds. C) banks have a distinct cost advantage over the money markets in providing short-term funds. D) the money markets cannot allocate short-term funds as efficiently as banks can. 6) Brokerag

6、e firms that offered money market security accounts in the 1970s had a cost advantage over banks in attracting funds because the brokerage firms A) were not subject to deposit reserve requirements. B) were not subject to the deposit interest rate ceilings. C) were not limited in how much they could

7、borrow from depositors. D) had the advantage of all the above. E) had the advantage of only A and B of the above. 7) Which of the following statements about the money markets are true? A) Not all commercial banks deal for their customers in the secondary market. B) Money markets are used extensively

8、 by businesses both to warehouse surplus funds and to raise short-term funds. C) The single most influential participant in the U.S. money market is the U.S. Treasury Department. D) All of the above are true. E) Only A and B of the above are true. 8) Which of the following statements about the money

9、 markets are true? A) Most money market securities do not pay interest. Instead the investor pays less for the security than it will be worth when it matures. B) Pension funds invest a portion of their assets in the money market to have sufficient liquidity to meet their obligations. C) Unlike most

10、participants in the money market, the U.S. Treasury Department is always a demander of money market funds and never a supplier. D) All of the above are true. E) Only A and B of the above are true. 9) Which of the following are true statements about participants in the money markets? A) Large banks p

11、articipate in the money markets by selling large negotiable CDs. B) The U.S. government and corporations borrow in the money markets because cash inflows and outflows are rarely synchronized. C) The Federal Reserve is the single most influential participant in the U.S. money market. D) All of the ab

12、ove are true. E) Only A and B of the above are true. 10) The most influential participant(s) in the U.S. money market A) is the Federal Reserve. B) is the U.S. Treasury Department. C) are the large money center banks. D) are the investment banks that underwrite securities. 11) The Fed is an active p

13、articipant in money markets mainly because of its responsibility to A) lower borrowing costs to encourage capital investment. B) control the money supply. C) increase the interest income of retirees holding money market instruments. D) assist the Securities and Exchange Commission in regulating the

14、behavior other money market participants. 12) Commercial banks are large holders of _ and are the major issuer of _. A) negotiable certificates of deposit; U.S. government securities B) U.S. government securities; negotiable certificates of deposit C) commercial paper; Eurodollars D) Eurodollars; co

15、mmercial paper 13) The primary function of large diversified brokerage firms in the money market is to A) sell money market securities to the Federal Reserve for its open market operations. B) make a market for money market securities by maintaining an inventory from which to buy or sell. C) buy mon

16、ey market securities from corporations that need liquidity. D) buy T-bills from the U.S. Treasury Department. 14) Finance companies raise funds in the money market by selling A) commercial paper. B) federal funds. C) negotiable certificates of deposit. D) Eurodollars. 15) Finance companies play a un

17、ique role in money markets by A) giving consumers indirect access to money markets. B) combining consumers investments to purchase money market securities on their behalf. C) borrowing in capital markets to finance purchases of money market securities. D) assisting the government in its sales of U.S

18、. Treasury securities. 16) When inflation rose in the late 1970s, A) consumers moved money out of money market mutual funds because their returns did not keep pace with inflation. B) banks solidified their advantage over money markets by offering higher deposit rates. C) brokerage houses introduced

19、highly popular money market mutual funds, which drew significant amounts of money out of bank deposits. D) consumers were unable to take advantage of higher rates in money markets because of the requirement of large transaction sizes. 17) Which of the following is the largest borrower in the money m

20、arkets? A) commercial banks B) large corporations C) the U.S. Treasury D) U.S. firms engaged in foreign trade 18) Money market instruments issued by the U.S. Treasury are called A) Treasury bills. B) Treasury notes. C) Treasury bonds. D) Treasury strips. 19) The Treasury auctions 91-day and 182-day

21、Treasury bills once a week. It auctions 52-week bills A) once a month. B) once every 13 weeks. C) once a year. D) every two weeks. 20) Which of the following statements are true of Treasury bills? A) The market for Treasury bills is extremely deep and liquid. B) Occasionally, investors find that ear

22、nings on T-bills do not compensate them for changes in purchasing power due to inflation. C) By volume, most Treasury bills are sold to individuals who submit noncompetitive bids. D) All of the above are true. E) Only A and B of the above are true. 21) Suppose that you purchase a 91-day Treasury bil

23、l for $9,850 that is worth $10,000 when it matures. The securitys annualized yield if held to maturity is about A) 4 percent. B) 5 percent. C) 6 percent. D) 7 percent. 22) Suppose that you purchase a 182-day Treasury bill for $9,850 that is worth $10,000 when it matures. The securitys annualized yie

24、ld if held to maturity is about A) 1.5%. B) 2%. C) 3%. D) 6%. 23) Treasury bills do not A) pay interest. B) have a maturity date. C) have a face amount. D) have an active secondary market. 24) If your competitive bid for a Treasury bill is successful, then you will A) certainly pay less than if you

25、had submitted a noncompetitive bid. B) probably pay more than if you had submitted a noncompetitive bid. C) pay the average of prices offered in other successful competitive bids. D) pay the same as other successful competitive bidders. 25) If your noncompetitive bid for a Treasury bill is successfu

26、l, then you will A) certainly pay less than if you had submitted a competitive bid. B) certainly pay more than if you had submitted a competitive bid. C) pay the average of prices offered in other noncompetitive bids. D) pay the same as other successful noncompetitive bidders. 答案：1-5：CBDDA 6-10:EEDDA 11-15:BBBAA16-20:CCAAE 21-25:CCABD