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51. Relative to treasury securities, agency securities have __________ liquidity

ID: 2672466 • Letter: 5

Question

51. Relative to treasury securities, agency securities have __________ liquidity and ___________ default risk.
less, less
less, more
more, more
more, less


52. Which of the following is not one of the advantages of money market mutual funds?
enhanced liquidity
greater flexibility
higher yields
exemption from state and local income taxes


53. Mortgage backed government agency securities are NOT suited to the short-term investor because they
have high interest rate risk
have uneven cash flows
do not permit prepayment of the mortgages backing them
all the above are correct
‘a’ and ‘b’


54. Money market securities are issued in:
The primary market
The secondary market
The private placement market
all of the above
‘a’ and ‘c’


55. The _______ is the rate charged depository institutions when they borrow reserves from the Fed; the _______ is the rate charged on reserve borrowings transacted between banks.
Discount rate, Fed funds rate
Fed funds rate, Discount rate
LIBOR, Fed funds rate
Fed funds rate, LIBOR

Explanation / Answer

51. Relative to treasury securities, agency securities have __________ liquidity and ___________ default risk.
less, less
less, more
more, more
more, less


52. Which of the following is not one of the advantages of money market mutual funds?
enhanced liquidity
greater flexibility
higher yields
exemption from state and local income taxes


53. Mortgage backed government agency securities are NOT suited to the short-term investor because they
have high interest rate risk
have uneven cash flows
do not permit prepayment of the mortgages backing them
all the above are correct
‘a’ and ‘b’


54. Money market securities are issued in:
The primary market
The secondary market
The private placement market
all of the above
‘a’ and ‘c’


55. The _______ is the rate charged depository institutions when they borrow reserves from the Fed; the _______ is the rate charged on reserve borrowings transacted between banks.
Discount rate, Fed funds rate
Fed funds rate, Discount rate
LIBOR, Fed funds rate
Fed funds rate, LIBOR

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