10 Explain the difference between (a) public offerings and private placements, (b)

primary markets and secondary markets, (c) the money market and the capital market,

and (d) organized security exchanges and over-the-counter markets.

11 Within the financial markets, explain what we mean by "private placements" and

name the advantages and disadvantages.

12Examine the securities below and identify the security with the highest liquidity

premium, the highest default risk premium, and the highest maturity premium.

a. 30-year U.S. Government Treasury bond maturing in 2025

b. 25-year Bbb-rated corporate bond maturing in 2030, actively traded on the New

York Exchange

c. 10-year Aaa-rated corporate bond maturing in 2020, thinly traded on a regional

exchange

d. 3-month U.S. Treasury bill

13Distinguish between the concepts of the maturity-risk premium and the liquidity-risk

premium.

14Identify three prominent theories that attempt to explain the term structure of interest

rates.