2/6/2020 Practice Quiz M3 (Ungraded)

My courses ▶ (20/01) MScFE 560 Financial Markets (C20-S1)

▶ Module 3: Interest and Money Markets ▶ Practice Quiz M3 (Ungraded)

Started on Thursday, 6 February 2020, 5:37 PM

State Finished
Completed on Thursday, 6 February 2020, 5:41 PM
Time taken 4 mins 1 sec

Question 1

Complete

Not graded

Consider the following statements:

Statement A: Long-term investors usually face relative performance risk

when investing in the money markets.
Statement B: Default risk tends to increase interest rates.

Which of the statements given above is correct?

Select one:
Only statement A
Neither statement A nor B

Both statement A and B

Only statement B

Your answer is correct.

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2/6/2020 Practice Quiz M3 (Ungraded)

Question 2

Complete

Not graded

Consider the following statements:

Statement A: Money-market instruments are low in default risk because

they are issued by government.
Statement B: The par value of a debt instrument is usually greater than its
price at an earlier time.

Which of the statements given above is correct?

Select one:
Only statement B
Neither statement A nor B

Both statement A and B

Only statement A

Your answer is correct.

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2/6/2020 Practice Quiz M3 (Ungraded)

Question 3

Complete

Not graded

Consider the following statements:

Statement A: Negotiable certi cates of deposit are more liquid than non-
negotiable certi cates of deposit.
Statement B: Money-market instruments that cannot be traded secondarily
are illiquid.

Which of the statements given above is correct?

Select one:
Only statement A
Only statement B

Neither statement A nor B

Both statement A and B

Your answer is correct.

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2/6/2020 Practice Quiz M3 (Ungraded)

Question 4

Complete

Not graded

Consider the following statements:

Statement A: Interest rates must be converted to discount rates in order to

calculate discount factors.
Statement B: An entity with greater credit risk faces higher borrowing
costs.

Which of the statements given above is correct?

Select one:
Both statement A and B
Only statement B

Only statement A
Neither statement A nor B

Your answer is correct.

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2/6/2020 Practice Quiz M3 (Ungraded)

Question 5

Complete

Not graded

Consider the following statements:

Statement A: Loans facilitated by the money-market tend to bring more

bene t to borrowers than to lenders.
Statement B: A money-market instrument’s par value can be viewed as a
promised loan repayment.

Which of the statements given above is correct?

Select one:
Both statement A and B
Only statement B
Only statement A
Neither statement A nor B

Your answer is correct.

◄ Notes 4 M3
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Live Session M3 ►

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