Financial Markets and Institutions Test Bank
,
,1
Financial Markets and Institutions Test Bank
Chapter 1
Role of Financial Markets and Institutions
1. Financial market participants who provide funds are called A) deficit units.
B) surplus units.
C) primary units.
D) secondary units.
2. The main provider(s) of funds to the U.S. Treasury is (are) A) households and
businesses.
B) foreign financial institutions.
C) the Federal Reserve System.D) foreign nonfinancial
sectors.
3. The largest deficit unit is (are)
A) households and businesses.
B) foreign financial institutions.
C) the U.S. Treasury.
D) foreign nonfinancial sectors.
4. Those financial markets that facilitate the flow of short-term funds are known asA)
money markets.
B) capital markets.
pg. 1
, 2
C) primary markets.
D) secondary markets.
5. Funds are provided to the initial issuer of securities in the A) secondary market.
B) primary market.
C) deficit market.
D) surplus market.
6. Which of the following is a capital market instrument?
A) a six-month CD
B) a three-month Treasury billC) a ten-year bond
D) an agreement for a bank to loan funds directly to a company for nine months.
7. Which of the following is a money market security?
A) Treasury note
B) municipal bond
C) mortgage
D) commercial paper
8. The most common investors in Federal funds are
A) households.
B) depository institutions.
C) firms.
D) government agencies.
pg. 2
,
,1
Financial Markets and Institutions Test Bank
Chapter 1
Role of Financial Markets and Institutions
1. Financial market participants who provide funds are called A) deficit units.
B) surplus units.
C) primary units.
D) secondary units.
2. The main provider(s) of funds to the U.S. Treasury is (are) A) households and
businesses.
B) foreign financial institutions.
C) the Federal Reserve System.D) foreign nonfinancial
sectors.
3. The largest deficit unit is (are)
A) households and businesses.
B) foreign financial institutions.
C) the U.S. Treasury.
D) foreign nonfinancial sectors.
4. Those financial markets that facilitate the flow of short-term funds are known asA)
money markets.
B) capital markets.
pg. 1
, 2
C) primary markets.
D) secondary markets.
5. Funds are provided to the initial issuer of securities in the A) secondary market.
B) primary market.
C) deficit market.
D) surplus market.
6. Which of the following is a capital market instrument?
A) a six-month CD
B) a three-month Treasury billC) a ten-year bond
D) an agreement for a bank to loan funds directly to a company for nine months.
7. Which of the following is a money market security?
A) Treasury note
B) municipal bond
C) mortgage
D) commercial paper
8. The most common investors in Federal funds are
A) households.
B) depository institutions.
C) firms.
D) government agencies.
pg. 2
