Chapter 5 example questions WebThis instrument is a. a banker's acceptance. A) Consular invoices B) Insurance documents C) Certificates of analysis D) None of the above, The risk of default on the part of the importer is present as soon as. S65 Flashcards | Quizlet C) business firms. ____ are documents included in a contract to ensure that specific quality, purity, or weight specifications are met. WebAn exporter has just received a banker's acceptance created by an international transaction. C) transfer title. If the borrowing arrangement is all-inclusive and involves a dealers commission and backup costs, for example, in the case of commercial paper, the formula is again adjusted as follows: $$ \text{Cost}=\cfrac {\text{Interest}+\text{Dealers commission}+\text{Backup costs} }{\text{Loan amount}-\text{Interest}} $$. A suppler of funds who directly invests in a fund user's financial claims faces a high cost of monitoring the fund user's actions in a timely and complete fashion after purchasing securities. Quizlet Buying extra inventory in response to an unexpected sale offered by a supplier Distributing the weekly paychecks Increasing the minimum cash balance for the firm's main bank account Unexpectedly purchasing a This is an example of an. "The average daily rate charged by member banks for overnight loans of reserves" best describes the: The interest rate charged on Eurodollar loans between major international banks is: All of the following securities are quoted on a yield basis. WebB. WebStudy with Quizlet and memorize flashcards containing terms like Bank of International Cooperation (JBIC), banker's acceptance, beta risk and more. The disadvantages of a letter of credit to the importer include. ___ may be required so that the contents of containers can be identified, either for customs purposes or for importer identification of the contents of separate containers. Answer: D. t/f: In a letter of credit, the bank substitutes its credit for that of the importer and promises to pay if certain documents are submitted to the bank. On a net basis, funds in the financial markets are generally supplied by A) individuals. Quizlet A) banker's acceptance B) bill of exchange C) bill of lading D) letter of credit, The person or company initiating the draft or bill of exchange is known as the. WebStudy with Quizlet and memorize flashcards containing terms like Which statement is TRUE regarding a corporation that has adopted cumulative voting? Exam 2 FRM, GARP, and Global Association of Risk Professionals are trademarks owned by the Global Association of Risk Professionals, Inc. CFA Institute does not endorse, promote or warrant the accuracy or quality of AnalystPrep. B) time draft. A customer wishes to buy a $50,000 certificate of deposit offered by your firm. a. slows, lengthens. business math. It is a short-term loan that is guaranteed by a bank. A Bank of America spokesman said the bank had voluntarily reduced overdraft fees from $35 to $10 in early 2022 and had eliminated its $35 insufficient funds Question #2 of 84Question ID: 1268990 a. negotiable certificates of deposit b. treasury bills c. banker's acceptances d. treasury receipts a. negotiable certificates of and more. d. a trade acceptance. Treasury bills commercial paper common stock repurchase agreements bankers' acceptances, Which of the following classes of securities are recorded at amortized cost on the balance sheet? Bankers Acceptance support@analystprep.com. It is a negotiable money market instrument. NEW YORK REAL ESTATE UNIT 12 -QUIZ Flashcards | Quizlet 184 ch 6 Debt Securities B) banker's acceptances (BAs). B) importer, exporter, and shipping company. WebBankers Acceptances Students also viewed. Business Law Final Review Reading 35 LOS 35g: Evaluate the choices of short-term funding available to a company and recommend a financing method D) any of the above, Which of the following relationships between importing and exporting (e) None of the above., China has become more important in international What is the term for the amount a firm will pay shareholders based on the size of their investment in the company? WebWe would like to show you a description here but the site wont allow us. WebStudy with Quizlet and memorize flashcards containing terms like Exporters may not know if importers are good credit risks. C) The exporter applies to its local bank for the issuance of a letter of credit. WebA bank has interest income to total assets ratio of 5.45% and has non-interest income of $45 million and total assets of $700 million. STI_water. Banker's Acceptances may be sold without a prospectus. C. money market transaction. Quizlet What should the registered representative tell the client? WebStudy with Quizlet and memorize flashcards containing terms like 1) Activity in money markets increased significantly in the late 1970s and early 1980s because of A) rising short-term interest rates. C) free the seller from any merchandise guarantees. Commercial paper has a maximum maturity of 270 days Commercial paper matures on a pre-set date at a pre-set price Commercial paper is quoted on a yield basis Commercial paper is an unsecured promissory note, beyond 270 days the issuing firm is required to file with SEC. An investor who is long MES equity put options is. I. U.S. WebStudy with Quizlet and memorize flashcards containing terms like The P/E ratio of a company is:, What is a warrant?, What is a right? Answer: D. t/f: A sight draft is payable on presentation to the drawee; a time draft allows a delay in payment. WebStudy with Quizlet and memorize flashcards containing terms like Created by the importer's bank after title has been taken for the goods, a(n) _______ is a negotiable money market B) regulations that limited what banks could pay for deposits. FI 1 Flashcards | Quizlet Minority stockholders have the ability to elect the director of their choice C. Each director must be elected by a majority of the Regular assessment of short-term funding aims to ensure that a company has the ability to handle peak cash needs and maintain sufficient sources of credit to fund ongoing cash needs. The price of the ETN rose 2% after the downgrade was announced. Business Law - test 1 D) letter of credit. A signed ________ is issued by the exporter and contains a precise description of the merchandise. B) the time involved in shipping is generally reduced. Upon receipt of his next account statement, the customer sees that the market value of the CD is shown as $99,800. An exporter has just received a banker's acceptance created by an international transaction. WebStudy with Quizlet and memorize flashcards containing terms like The majority of money market securities are low-denomination, low-risk investments designed to appeal to individual investors with excess cash., In the T-bill secondary market the ask yield will normally be less than the bid yield., Commercial paper is a short-term obligation of the WebStudy with Quizlet and memorize flashcards containing terms like what characteristics define the money markets?, is a treasury bond issued 29 years ago with 6 months remaining before it matures a money market instrument?, why do banks not eliminate the need for money markets? Correct A. ADR B. LIBOR C. Eurodollar deposit D. Banker's Acceptance. A) irrevocable; unconfirmed B) revocable; confirmed C) confirmed; irrevocable D) unconfirmed; confirmed. FIN310 Chapter 17 Questions B) unaffiliated unknown party transaction. C) affiliated party transaction. Banker's acceptances. * mutual fund. A repo is in essence a collateralized A. banker's acceptance. Activity in the secondary C) It must be in writing and signed by the maker or drawer. WebStudy with Quizlet and memorize flashcards containing terms like The exporter-importer relationship to a corporation of a foreign importer that has not previously conducted business with the firm would be an: A) unaffiliated known. A) unaffiliated known party transaction. WebStudy with Quizlet and memorize flashcards containing terms like True or false: A banker's acceptance is a form of commercial paper and can be bought and sold in the financial markets., Selling an exporter's accounts receivable on ordinary goods with the balance due upon delivery or soon after is called _____ ., A time draft with a maturity date of less than B) It acts as a contract. 2.Federal funds (fed funds) 3.Repurchase agreements (repos or RP) 4.Commercial paper (CP) 5.Negotiable certificates of deposit (CD) 6.Banker acceptances (BA) Treasury Bills (T-Bills) T-Bills are short-term debt obligations issued by the U.S. government. As the broker handling the account, you should tell the customer that: as long as the CD is titled in the customer's name and the customer does not have accounts at the issuing bank totaling more than $200,000, then the CD is FDIC insured, -Any call features could affect the maturity of the instrument -How the instrument is titled can determine whether FDIC insurance covers the investment, -Structured products offer an index-linked return and a fixed maturity -Structured products are principal protected, A structured product is a derivative security that is structured to have the characteristics of a debt, but give the higher returns typically associated with equity securities Structured products give a rate of return linked to an equity index such as the Standard and Poors 500 index Structured products have a fixed maturity at par in around 7 years based on an embedded option in the security, -Early redemption can result in the imposition of a penalty of 3-5% of the principal amount invested -The CD can only be redeemed on a specified date during each calendar quarter -The rate of return may be capped to a limit that is lower than the return of the reference stock index -Market index linked CDs typically have a minimum life of 3 years, -Traditional CDs do not have market risk if redeemed prior to maturity -Market index linked CDs have market risk if redeemed prior to maturity, In order to recommend a structured product to a customer, all of the following statements are true, completion of the "reasonable basis" suitability determination means that the structured product can be recommended to all the firm's customers. time deposit. A. Which of the following relationships between importing and exporting parties would require the least detailed contract to conduct business? The customer should be informed about all of the following, "knock-in" price of the underlying security gives the customer the right to put the note back to the issuer at par at maturity. WebAny object can serve as money if it is portable, divisible, durable and stable. 5360- Money and Capital Markets Chapter 6 Flashcards B) It must be payable on demand or at a fixed or determinable future date. Start studying for CFA exams right away! THE MONEY MARKET - Banking Final #7 Since the 7.85% cost for the bankers acceptance is the lowest of the three options, the bankers acceptance has the lowest cost of credit. James Chen Updated June 22, 2022 Reviewed by Margaret James Investopedia / Sydney Burns What Is a Banker's Acceptance (BA)? D) any of the above. If the customer wishes to tender the CD prior to maturity, the registered representative should inform the customer that: the customer will receive the market value plus accrued interest, -The interest payment may be reduced -The principal payment is fixed, -Initial payments are made at an interest rate that is above the market rate -At a predetermined time, the interest rate is decreased to a rate that is at, or below, the market. WebStudy with Quizlet and memorize flashcards containing terms like All of the following are considered money market instruments except A) negotiable jumbo certificates of deposit (CDs). (b) increased competition from domestic and foreign firms. D) goods are received. 447- Chp 19 After taking the title for the goods via the bill of lading, the importer's bank accepts the time draft. WebAn entity that sells goods and services usually accepts either cash or credit. D) none of the above. Quizlet Money markets. Which securities will trade with accrued interest? B) free the seller from concerns over the payment abilities of the buyer. a. consignment; prepayment b. open account; prepayment c. prepayment; open account d. prepayment; consignment, Credit means that while the customer gets the said goods or services, they do not have to pay for it immediately, and can pay at a later date. Further, GARP is not responsible for any fees or costs paid by the user to AnalystPrep, nor is GARP responsible for any fees or costs of any person or entity providing any services to AnalystPrep. B) prove ownership. Quizlet Finance Quizzes Chapters 1-3 and more. Ch. 16 Video- Moonworks Ch. 16 A) Clean; new trading partners B) Documentary; their own affiliates C) Clean; their own affiliates D) None of the above, t/f: Most drafts in international trade are "clean", Drafts that have been accepted by banks become. Commercial paper is a short A. liquid; segmented B. illiquid; segmented C. WebStudy with Quizlet and memorize flashcards containing terms like Which of the following methods is (are) used to transfer surplus funds from local (collection) bank accounts to concentration (disbursement) bank accounts? A) commercial invoice B) banker's acceptance C) packing list D) bill of lading. For a line of credit which requires payment of a commitment fee: $$ \text{Cost}=\cfrac {\text{Interest}+\text{Commitment Fee}}{\text{Loan amount}} $$. CFP Course 3 Quiz Answers C. for greater darlene9764. WebStudy with Quizlet and memorize flashcards containing terms like OBJECTIVES OF MONEY MARKET; national and international trade, MONEY MARKET, MONEY MARKET and more. Which of the following purposes is NOT served by the bill of lading? Ch 17-18 Extra Credit Quiz D) none of the above. Quizlet Quiz 7 About Quizlet; For municipal debt issues, which of the following is TRUE? d. any of the above, Polaris Corporation has made an agreement to ship goods to a foreign A) exporter's; portfolio risk B) importer's; blocked foreign exchange C) exporter's; blocked foreign exchange D) none. Banker's Acceptance (BA): Definition, Meaning, and Types WebStudy with Quizlet and memorize flashcards containing terms like Which of the following securities may have their registration denied or revoked by the Administrator? - True - False, Money markets exist to help reduce the opportunity cost of holding cash balances. WebStudy with Quizlet and memorize flashcards containing terms like The exporter - importer relationship to a corporation of a foreign importer that has not previously conducted business with the firm would be an: a. unaffiliated unknown. Granting credit means the firm will have a receivable from the customer. A) ship money abroad. Evaluate the choices of short-term funding available to a company and recommend a financing method, The breakeven quantity of sales or just simply breakeven point indicates the number Read More, It is crucial that a company effectively manages its accounts receivables, inventory positions, Read More, Book value per share (BVPS) refers to a companys total shareholders equity divided Read More, The board of directors oversights company operations and serves as the link between Read More, All Rights Reserved One solution to this problem is for a large number of small investors to place their funds with a single FI serving as a broker between the two parties. WebTest Match Created by sunitasumair Terms in this set (90) Money market instruments are defined as unsecured debts with 1 year or less to maturity. 2003-2023 Chegg Inc. All rights reserved. WebStudy with Quizlet and memorize flashcards containing terms like 5.1) *A customer buys a Brokered CD for $100,000. WebTerms in this set (32) represent a powerful force in the buying and selling of corporate securities. 5 year maturity Treasury note Common stock Preferred stock Commercial paper, All else equal which one of the following will usually have the lowest yield? Web11. If the banker's acceptance has a face value of $250,000 and the bank charges a commission of 1% per annum, how much will the exporter receive from the banker if the acceptance is held until maturity six months from today? - denominations range from $100,000-$10 million. A) transfer product. Bank BUS6600 Module 3 4) All of the above 5) None of the above, In attempting a credit WebWhich statements are TRUE regarding market index linked certificates of deposit? The exporter-importer relationship to a corporation of a foreign importer that has not previously conducted business with the firm would be an. commercial paper at 7.4% with dealers commission of % and backup costs of 1/3%. WebStudy with Quizlet and memorize flashcards containing terms like If a firm lies within a country with ________ or ________ domestic capital markets, it can achieve lower global cost and greater availability of capital with a properly designed and implemented strategy to participate in international capital markets. b.the difference between a fixed-rate yield and a floating-rate yield. and more. Banker's acceptances are issued by firms as part of a commercial transaction. D) The importer's bank cuts a sales contract based on its assessment of the creditworthiness of the importer. WebWhich of the following statements BEST describes a banker's acceptance (BA)? WebStudy with Quizlet and memorize flashcards containing terms like Which one of the following best represents the transaction motive for holding cash? The M-2 money supply includes everything that is in the M-1 money supply. Commercial paper is an unsecured promissory note. B) import agricultural products during the recession. Transactions Risk. - Money. The short-term funding alternatives that are available to a company may be divided into bank sources and non-bank sources. A bill of exchange or draft drawn on a bank and commonly used to guarantee exporters that they will receive payment on goods delivered to importers is a/an. C) are the large money center banks. An air waybill acts as: a. BANKER`S ACCEPTANCE. Bank of America Fined $150 Million Over Junk Fees - The New Chapter 6/7/8 Flashcards | Quizlet Quoted on a yield basis D is an unsecured promissory note, Commercial paper most common maturity is, Upon receipt of his next account statement, the customer sees that the market value of the CD is shown as $99,800. 15 terms. C) facilitate and stimulate foreign trade of the United States. Chapter 15 & 16 Quiz WebThe maximum maturity on a banker's acceptance is: A. WebStudy with Quizlet and memorize flashcards containing terms like Which money market instrument is issued by corporations? Quizlet FINC 409 Ch. 2 Low trading costs II. C) provides letters of credit for U.S. exporters. ____ drafts are unaccompanied by any other documents, and are usually used between MNEs and ________. WebStudy with Quizlet and memorize flashcards containing terms like Everything else equal, an effective annual rate will be greater than the bond equivalent yield on the same security. Ch2): Money Market Debt/Structured Products (Sec Quizlet A) maker. Chapter 20: Smartbook Flashcards | Quizlet horticultural 1 week 2 ** 16 terms. Money Market Questions Short-term changes in exchange rates can affect operating costs and revenues of firms engaged in international business activities. Commercial paper. WebThe risk of the banker's acceptance depends most likely on the: a. Canadian bank b. apple farmer c. US Fertilizer firm d. apple market, A firm has $5 billion outstanding in long-term bonds. In mutual savings banks, all depositors are considered owners of the bank. current ratio of 2:1 or higher. WebStudy with Quizlet and memorize flashcards containing terms like All of the following statements are true regarding Construction Loan Notes EXCEPT: a. An exporter has just received a banker's acceptance created by an international transaction. C) unaffiliated unknown. Draft can pass through many parties' hands before a bank (drawee) accepts it, transforming the draft into a banker's acceptance. FIN327 Ch 2 Quiz WebStudy with Quizlet and memorize flashcards containing terms like A "blue chip" corporation experiencing a short term cash flow shortage could issue: A. banker's acceptances B. note certificate of deposit trade acceptance cashier's check, Which of the following is not a negotiable instrument?

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