2. Statement 1: Debt securities represent ownership in a firm that would entitle the holders certaindividends and claims in a firm.Statement 2: Equity securities are loans made by the issuing firm that would entitle the holderscertain interest and maturity value.Statement 3: Debt securities include bonds, certificates of deposits, promissory notes, governmentnotes and bills.Statement 4: Equity securities include preferred and common stocks.Statement 5: Derivative securities include instruments whose underlying assets are bonds, stocks,commodities, currencies, interest rates and other assets.a. All statements are trueb.Statements 1, 2 and 3c. Statements 2, 3 and 4 are truare trued.Statements 3, 4 and 5e. Statements 1, 3 and 5 are truef. Statements 2, 4 and 5 are truare true

Investing is a critical component of wealth growth. It enables the investor to fight inflation,…

Answered: lends and claims in a firm. ement 2:…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

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2. Statement 1: Debt securities represent ownership in a firm that would entitle the holders certain dividends and claims in a firm. Statement 2: Equity securities are loans made by the issuing firm that would entitle the holders certain interest and maturity value. Statement 3: Debt securities include bonds, certificates of deposits, promissory notes, government notes and bills. Statement 4: Equity securities include preferred and common stocks. Statement 5: Derivative securities include instruments whose underlying assets are bonds, stocks, commodities, currencies, interest rates and other assets. a. All statements are true b. Statements 1, 2 and 3 c. Statements 2, 3 and 4 are true are true d. Statements 3, 4 and 5 e. Statements 1, 3 and 5 are true f. Statements 2, 4 and 5 are true are true
1. Investments in debt and equity securities that are held for current resale by banks and stockbrokerage firms are termed a. available-for-sale securitiesb. trading securitiesc. held-to-maturity securitiesd. marketable securities
2. Statement 1: Debt securities represent ownership in a firm that would entitle the holders certain dividends and claims in a firm. Statement 2: Equity securities are loans made by the issuing firm that wouldentitle the holders certain interest andmaturity value. Statement 3: Debt securities include bonds, certificates of deposits, promissorynotes, government notes and bills. Statement 4: Equity securities include preferred and common stocks. Statement 5: Derivative securities include instruments whose underlying assets are bonds, stocks, commodities, currencies, interest rates and other assets. a. All statements are true b.Statements 1, 2 and 3 are true c.Statements 2, 3 and 4 are true d.Statements 3, 4 and 5 are true e.Statements 1,3 and 5 are true f. Statements 2, 4 and 5 are true 3. Which is correct about financial securities? a. Financial securities guarantees retum to investors. b. Financial securities eliminate risk that most financial managers are facing. c. Diversification…
Marketable securities are a. long term in nature b. are examples of bonds c. traded in the money market d. traded in the capital market
Bonds that are issued on the general creditworthiness of the company are: Bonds that are issued on the general creditworthiness of the company are: 1. callable bonds 2. convertible bonds 3. secured bonds 4. debenture or unsecured bonds
20.Investments in debt securities are classified into the following categories according to management's intention: Select one: a."To hold until maturity", "available for sale" and "to trade". b. "To retain until maturity" and "to negotiate" c. All are classified as "to hold until maturity". d. "To retain until maturity" and "Available for sale".
The process of packaging and/or selling mortgages which are then used to back publicly traded debt securities is called A. collateralization B. securitization C. market capitalization O D. stock diversification
4. Investments in debt securities include all of the following, except for a. U.S. treasury securitiesb. corporate bondsc. preferred stocks that are redeemable at the option of the issuerd. commercial paper
which of the following instrument are traded in capital market. check all that apply A. commercial paper b. treasury bills c. cooperate bonds d. bankers appectances e. common stock
6. Which of the following is true of secondary securities? a) They include equities, bonds, and other debt claimsb) They are backed by the real assets of corporations issuing them c) They are securities that back primary securitiesd) They are securities issued by FIs
1. More than one measurement bases apply to investments in debt securities and investment in equity under PFRS 9. What are these measurement bases?2. Identify critical questions to be asked in applying PFRS 9 in the measurement of financial assets.3. How would you distinguish an equity instrument from a debt instrument?
(I) Capital market securities fall into two categories: bonds and stocks. (II) Long-termbonds include government bonds and long-term notes, municipal bonds, and corporate bonds.a) (I) is true, (II) false.b) (I) is false, (II) true.c) Both are true.d) Both are false

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