Exam 1: A Modern Financial System: An Overview

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Both real and financial assets have four principal attributes that are significant factors in the investment decision process.These are: I.liquidity II.capital gain III.risk IV.return or yield V.time pattern of future cash flows VI.price and cash flow volatility

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Debt instruments that can be easily sold and transferred in the financial markets are called:

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Financial institutions that raise the majority of their funds by selling securities in the money markets are:

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The process of facilitating the flow of funds between borrowers and lenders performed by the financial system:

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A well-functioning financial system enables participants to readily change the composition of their financial assets portfolio.

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The term 'medium of exchange' for money refers to its use as:

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Financial markets have developed to facilitate the exchange of money between savers and borrowers.Which of the following is NOT a function of money?

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When an individual has immediate access to their funds from an account with a financial intermediary,the intermediary is engaging in:

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When a financial intermediary can repeatedly use standardised documents,it is engaging in:

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The most important function of a financial market is to:

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Financial institutions that are formed under a trust deed and attract funds by inviting the public to buy units are:

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Which of the following is NOT a term associated with shares?

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Which of the following is NOT a feature of option contracts?

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Purchasing shares on the Australian Securities Exchange is an example of:

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Margin trading is the sale of a financial product that the seller does not own and who intends to buy back at a lower price later.

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A source of short-term liquidity funding for banks is the issue of:

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A primary financial market is one that:

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The market that includes individuals,companies and governments in the buying and selling of long-term debt and equity securities is the:

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A secondary financial market is one that:

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Buying bonds in the capital markets is an example of:

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