QUESTION 1

Which is not correct about repurchase agreement?

		A reverse repo is the purchase of securities by one party with an agreement to sell them.
		The most common maturities are from 1 day to 15 days and for one, three, six months and one year or longer.
		With a repurchase agreement (repo), one party sells securities to another with an agreement to repurchase the securities at a specified date and price.
		A repurchase agreement (or repo) represents a loan backed by the securities

QUESTION 2

Which is not correct?

		The shortage of the Segmented Markets Theory is that some borrowers and savers have the flexibility to choose among various maturities
		Segmented Markets Theory assumes that investors choose securities with maturities that satisfy their forecasted cash needs.
		According to pure expectations theory, the term structure of interest rates is determined solely by expectations of interest rates.
		Liquidity Premium Theory assumes that investors prefer long-term rather than short-term bonds.