B. TRUE OR FALSE: Write TRUE if the statement is correct; if incorrect, write FALSE. 1. Preferred stockholders get cash dividends before common stockholders. 2. A financial asset is any contract that reflects a residual stake in an entity's assets after all liabilities have been paid. 3. Interest rates on treasury bonds are often higher than those on corporate bonds. 4. A 10-year T-bond is a money market instrument. 5. A public offering is the selling of new securities to the general public, whereas an initial public offering (IPO) is the first issuance of shares. 6. Insurance companies pool payments and invest the proceeds in a variety of securities until funds are required to settle policyholder claims. 7. Financial markets give capital for financial managers to support business progress and development.
B. TRUE OR FALSE: Write TRUE if the statement is correct; if incorrect, write FALSE. 1. Preferred stockholders get cash dividends before common stockholders. 2. A financial asset is any contract that reflects a residual stake in an entity's assets after all liabilities have been paid. 3. Interest rates on treasury bonds are often higher than those on corporate bonds. 4. A 10-year T-bond is a money market instrument. 5. A public offering is the selling of new securities to the general public, whereas an initial public offering (IPO) is the first issuance of shares. 6. Insurance companies pool payments and invest the proceeds in a variety of securities until funds are required to settle policyholder claims. 7. Financial markets give capital for financial managers to support business progress and development.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:B. TRUE OR FALSE: Write TRUE if the statement is correct; if incorrect, write FALSE.
1. Preferred stockholders get cash dividends before common stockholders.
2. A financial asset is any contract that reflects a residual stake in an entity's assets after all
liabilities have been paid.
3. Interest rates on treasury bonds are often higher than those on corporate bonds.
4. A 10-year T-bond is a money market instrument.
5. A public offering is the selling of new securities to the general public, whereas an initial
public offering (IPO) is the first issuance of shares.
6. Insurance companies pool payments and invest the proceeds in a variety of securities
until funds are required to settle policyholder claims.
7. Financial markets give capital for financial managers to support business progress and
development.
8. BSP is in charge of supervising a country's monetary system and policies, managing its
money supply, and determining interest rates.
9. The stock price is used to determine the wealth of business owners.
10. Primary markets are markets for currently outstanding securities. These securities were
previously bought and owned by the initial investors in the financial market.
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