International Finance And Treasury - Study Mode

[#451] Federal reserve, money market brokers and dealers, mutual funds and US treasury are all participants of
Correct Answer

(B) money markets

Explanation

Solution: Federal reserve, money market brokers and dealers, mutual funds and US treasury are all participants of money markets. The money market is the trade in short-term debt investments. At the wholesale level, it involves large-volume trades between institutions and traders.

[#452] Repurchase agreements usually called repos can be traded
Correct Answer

(D) both a and b

Explanation

Solution: Repurchase agreements usually called repos can be traded directly and with brokers or dealers. A repurchase agreement (repo) is a form of short-term borrowing for dealers in government securities.

[#453] In Eurodollar market, increase in demand of Euro dollars results in
Correct Answer

(A) increase in LIBOR

Explanation

Solution: In Eurodollar market, increase in demand of Euro dollars results in increase in LIBOR. Deposits from overnight out to a week are priced based on the fed funds rate. Prices for longer maturities are based on the corresponding London Interbank Offered Rate (LIBOR).

[#454] Type of bids which states complete description about quantity of bids and prices of bids is classified as
Correct Answer

(C) competitive bids

Explanation

Solution: Type of bids which states complete description about quantity of bids and prices of bids is classified as competitive bids. Competitive bidding is a process of issuing a public bid with the intent that companies will put together their best proposal and compete for a specific project.

[#455] If 180 days T-bill have maturity of one year with value of $9250 and face value is $10000 then reported discount yield is
Correct Answer

(D) 15.00%