The process by which commercial banks transform funds provided by savers into funds used by borrowers is called _____.

Select one:

a. financial intermediation

b. investment banking

c. diversification

d. underwriting

e. shelf registration

Treasury bills are issued by the U.S. government. In which type of financial market do outstanding, or already issued treasury bills trade?

Select one:

a. Money market

b. Capital market

c. Primary market

d. Derivatives market

e. Stock market

A leading bank is coming up with an investment that pays 8 percent interest compounded semiannually. What is the investment's effective annual rate (rEAR)? Use a financial calculator to determine the amount.

Select one:

a. 8.76%

b. 8.56%

c. 8.96%

d. 8.16%

e. 8.36%