FINANCIAL MARKETS AND INSTITUTIONS ACTUAL TEST BANK TESTED QUESTIONS WITH VERIFIED SOLUTIONS

FINANCIAL MARKETS AND INSTITUTIONS
ACTUAL TEST BANK TESTED QUESTIONS
WITH VERIFIED SOLUTIONS

●● financial markets
Answer: To facilitate the flow of funds from surplus units to deficit
units.


●● surplus units
Answer: Participants who have excess funds and provide their net
savings to financial markets.


●● deficit units
Answer: Participants who spend more money than they receive and
access funds from financial markets.


●● debt securities
Answer: Securities that represent debt incurred by the issuer, where
deficit units are borrowers and surplus units are creditors.


●● equity securities
Answer: Securities that represent ownership in a firm, also known as
stocks.

, ●● corporate finance (financial management)
Answer: involves corporate decisions such as how much funding to
obtain and which types of securities to issue when financing operations.


●● liquidity
Answer: The degree to which securities can easily be sold without a loss
of value.


●● primary market transaction
Answer: facilitate the issuance of new securities. Thus, they allow
corporations to obtain new funds, and offer a means by which investors
can invest funds.


●● secondary market transaction
Answer: Investors sell existing securities, and no new funds are provided
to the issuer.


●● liquidity
Answer: which is the degree to which securities can easily be liquidated
(sold) without a loss of value.


●● Money market securities
capital market securities