financial institution that invests $100 million into corporate bonds is exposed to which of the following risks? a. Credit and interest rate risk. b. Liquidity and technology risk. c. Solvency and technology risk. d. Off-balance sheet and interest rate risk.
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- Which of the following fixed income securities has the highest level of risk? Which one has the highest level of liquidity? a. treasury bonds b. agency bonds c. corporate bonds d. municipal bondsBased upon risk, which of the following financial assets is likely to have the highest required rate of return? Select one: A. A corporate bond B. A U.S. Treasury bill C. A bank certificate of deposit D. A share of common stock12) Which of the following is NOT a property of Financial assets? A. Divisibility B. Reversibility C. Convertibility D. Marketability 13) Which of the following security is issued in money market: A. Common stock B. Preferred stock C. Bankers acceptance D. Commercial bonds 14) The money market is used to issue securities that maturity in: A. One year B. Two years C. Three years D. Four years 15) The capital market is used to issue securities that maturity in: A. 3 months B. 6 months C. 9 months D. 15 months 16) All the following factors contribute to the integration of the financial market: A. Liberalization B. Technology C. Institutionalization D. Democratization 17) Which money market instrument is infrequently traded in the Secondary Market: A. Treasury bills B. Commercial paper C. Certificate of deposit D. Repurchase agreement
- 4) I need help with finance homework questions asap, Multiple choice question. Bond ratings measure a company's: Exchange rate risk. Equity risk. Interest rate risk. Operating risk. Default risk.Which of the following is the risk due to a firm's debt usage? Business risk Financial risk Market risk Interest rate risk Purchasing power risk Exchange rate riskHow can a bank mitigate LIQUIDITY RISK? Hold a large percentage of its liabilities in Core Deposits Possess high-quality assets for collateralized borrowing Have a high equity capital to risk-weighted asset ratio All of the above
- The average maturity of its assets is larger than that of its deposits, as is typical of most banks. There is a (a)reinvestment risk (b)re-finance risk (c)re-pricing risk (d)default riskProvide an explanation of whether it is advantageous for a bank to classify debt investments as “held to maturity “or “available for sale” if the required return by the market declines? What impact will this have on the bank's balance sheet and net income?Liability management increases a bank's _________ risk and _________ risk.A. interest rate; priceB. liquidity; financialC. interest rate; financialD. price; interest rate
- What is interest rate risk? Elaborate with example. Explain in detail that how managers of financial institutions manage interest rate risk on Balance sheet.Changes in interest rates may change the market values of the bank's assets and liabilities by different amounts is a Select one: O a. Spread Risk O b. Refinancing risk O c. Reinvestment risk Od. Price RiskSelect the type of risk that is most evident in the pairings. Investments in Junk Bonds VS Investments in Treasury Bonds * Business Risk Default Risk Financial Risk Interest Rate Risk Liquidity Risk Management Risk Purchasing Power Risk Investment in a fix-rated bonds VS Investment in a variable-rated bond * Business Risk Default Risk Financial Risk Interest Rate Risk Liquidity Risk Management Risk Purchasing Power Risk Investment in stocks of a closely-held corporation VS Investment in stocks of a publicly listed corporation Business Risk Default Risk Financial Risk Interest Rate Risk Liquidity Risk Management Risk Purchasing Power Risk