Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Question
Holdings of government bonds are classified on a bank's balance sheet as
Group of answer choices
assets, because investing in government bonds represents a use of funds for investment.
liabilities, because the bank must borrow in order to be able to invest in the government bonds.
assets, because the markets for government bonds are the most liquid in the world.
liabilities, because the government bonds must be pledged as collateral against borrowing.
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- This type of financing involves a syndicate of financial institutions to provide debt financing. SEO Shelf registration Private placement Securitization Syndicated loans Project financingarrow_forwardWhat are some of the ways that banks can borrow short-term funds when they need "liquidity"?(Select all that apply; three of the answers below are correct.) Reference: Chapters 11 & 12 They can borrow directly from the Securities & Exchange Commission through the "regulatory" market. They can borrow from the Department of Treasury through the "Treasury" window. They can borrow another bank's reserves through the "fed funds" market. The can engage in a "sale & repurchase agreement" (or "repo") by selling some of their securities to another financial insitution and promising to buy them back the next day. They can borrow directly from the Federal Reserve through the "discount window".arrow_forwardThe primary reason for the creation of the Federal Reserve System was: OA. to stabilize short-term interest rates. OB. to reduce or eliminate future bank panics. OC to eliminate state-chartered banks. OD. to create a single central bank similar to the Bank of England.arrow_forward
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