.......... Can you answer this?

1. What is the primary function of large, diversified brokerage firms in the money market? a. To sell money market securities to the Federal Reserve for its open market operations b. To buy money market securities from corporations that need liquidity c. To make a market for money market securities by maintaining an inventory from which to buy or sell d. To buy T-bills from the U. S. Treasury Department

2. If bad credit risks are those that most actively seek and receive loans from financial intermediaries, what problem does this cause the financial intermediaries to face? a. Moral hazard b. Adverse selection c. Free-riding d. Costly state verification

3. All financial intermediary institutions in the intermediation market a. buy primary securities and sell secondary securities b. borrow short and lend long c. borrow in small denominations and lend in large d. buy from brokers and dealers and sell to the public

4. What are Federal funds? a. Treasury notes b. Commercial bank deposits at the Federal Reserve c. Federal Reserve assets d. Vault cast of the Federal government

5. Which of the following statements always describes the relationship between current yield and yield to maturity? a. The current yield is higher. b. The two yields are the same. c. The yield to maturity reflects the total return; the current yield only the cash return. d. The yield to maturity should be used in comparing bonds which are to be held to maturity; the current yield for comparing bonds which are to be sold before maturity.

6. A bank is solvent as long as it a. has enough capital to pay off depositors b. has mostly good loans c. does not experience a run on its deposits d. is able to meet all demands by depositors for payment

7. As opposed to most other debt instruments, mortgage loans tend to a. charge lower interest rates b. be of larger denomination c. pay interest less frequently d. be repaid over the life of the loan

8. In most variable-rate mortgages, the homebuyer a. assumes none of the interest rate risk b. assumes all of the interest rate risk c. shares the interest rate risk with the lender d. does not repay the principal until maturity

9. A futures contract is an agreement to trade an asset a. in the future at a price determined today b. today at a price prevailing at some future date c. in the future at a price prevailing in the future d. today at a price determined today

10. What is the object of fixed exchange rates? a. To prevent exchange rates from changing b. To prevent misallocation of economic resources c. To eliminate the economic fluctuations that result from short-run, self-reversing forces d. To prevent the effects of one country's inflationary policies from spreading to other