TEST BANK For Financial Markets and
Institutions, 8th Edition by Anthony
Saunders, Marcia Cornett, All Chapters 1 -
25, Complete Newest Version
,Chapter 1
Student name: _
1) What factors are encouraging financial institutions to offer overlapping financial
servicessuch as banking, investment banking, brokerage, etc.? 1.I. Regulatory changes
allowing institutions to offer more services
2.II. Technological improvements reducing the cost of providing financial
services
3.III. Increasing competition from full-service global financial institutions
4.IV. Reduction in the need to manage risk at financial institutions
A) I only
B) II and III only
C) I, II, and III only
D) I, II, and IV only
E) I, II, III, and IV
2) IBM creates and sells additional stock to the investment banker Morgan
Stanley. Morgan Stanley then resells the issue to the U.S. public through its mutual
funds.
This transaction is an example of a(n):
A) primary market transaction.
,B) asset transformation by Morgan Stanley.
C) money market transaction.
D) foreign exchange transaction.
E) forward transaction.
, 3) IBM creates and sells additional stock to the investment banker Morgan
Stanley. Morgan Stanley then resells the issue to the U.S. public through its mutual
funds.
Morgan Stanley is acting as a(n)
A) asset transformer.
B) asset broker.
C) government regulator.
D) foreign service representative.
E) derivatives trader.
4) A corporation seeking to sell new equity securities to the public for the first time
in orderto raise cash for capital investment would most likely:
A) conduct an IPO with the assistance of an investment banker.
B) engage in a secondary market sale of equity.
C) conduct a private placement to a large number of potential buyers.
D) place an ad in the Wall Street Journal soliciting retail suppliers of funds.
E) issue bonds with the assistance of a dealer.
5) The largest capital market security outstanding in 2019 measured by market value was:
Institutions, 8th Edition by Anthony
Saunders, Marcia Cornett, All Chapters 1 -
25, Complete Newest Version
,Chapter 1
Student name: _
1) What factors are encouraging financial institutions to offer overlapping financial
servicessuch as banking, investment banking, brokerage, etc.? 1.I. Regulatory changes
allowing institutions to offer more services
2.II. Technological improvements reducing the cost of providing financial
services
3.III. Increasing competition from full-service global financial institutions
4.IV. Reduction in the need to manage risk at financial institutions
A) I only
B) II and III only
C) I, II, and III only
D) I, II, and IV only
E) I, II, III, and IV
2) IBM creates and sells additional stock to the investment banker Morgan
Stanley. Morgan Stanley then resells the issue to the U.S. public through its mutual
funds.
This transaction is an example of a(n):
A) primary market transaction.
,B) asset transformation by Morgan Stanley.
C) money market transaction.
D) foreign exchange transaction.
E) forward transaction.
, 3) IBM creates and sells additional stock to the investment banker Morgan
Stanley. Morgan Stanley then resells the issue to the U.S. public through its mutual
funds.
Morgan Stanley is acting as a(n)
A) asset transformer.
B) asset broker.
C) government regulator.
D) foreign service representative.
E) derivatives trader.
4) A corporation seeking to sell new equity securities to the public for the first time
in orderto raise cash for capital investment would most likely:
A) conduct an IPO with the assistance of an investment banker.
B) engage in a secondary market sale of equity.
C) conduct a private placement to a large number of potential buyers.
D) place an ad in the Wall Street Journal soliciting retail suppliers of funds.
E) issue bonds with the assistance of a dealer.
5) The largest capital market security outstanding in 2019 measured by market value was:
