13. Which of the following is the major function of a financial market?

It:

A. determines the level of interest rates

B. allows common stock to be traded

C. allows loans to be made

D. channels funds from lenders-savers to borrowers-spenders

14. Most dealers in the over the counter market are:

A. traders on the stock exchange floor

B. traders of only one security

C. connected to a computer network called OTCBB

D. member of an insider group

15. The money market is the market in which are traded.

A. new issues of securities

B. previously issued securities

C. short-term debt instruments

D. long-term debt and equity instruments

16. The Jamaica Stock Exchange could be classified as a/an security exchange.

A. intangible

B. organized

C. primary

D. money

17. Which of the following is a secondary market transaction?

A. An initial public offering

B. You buy 2000 shares of Grace Kennedy stock from your brother

C. Grace Kennedy issued 2 million new stock to the public

D. Grace Kennedy issued treasury bills to the government

18. Intermediaries who are agents of investors and match buyers with sellers of securities are called:

A. investment bankers

B. traders C. brokers D. dealers

19. Which of the following assist companies in raising capital, advise firms on major transactions such as mergers or financial restructuring and engage in trading and market making activities?

A. Investment banks

B. Securities Exchanges

C. Mutual funds

D. Commercial banks

20. Which of the following serve as intermediaries channelling the savings of individuals, businesses and governments into loans and investments?

A. Financial Institutions

B. Financial Markets

C. Securities Exchanges

D. OTC market

21. Which of the following is an example of a contractual financial institution?

A. Building Society

B. Credit union

C. Insurance Company

D. Merchant Bank

22. Jamaica Broilers, issuing new stock to raise capital for retooling, is a good example of: A. an organized exchange

B. a primary market issue

C. a secondary market issue

D. how the industry works

23. The function of providing liquidity by financial intermediaries: A. includes depositors withdrawing funds but not borrowers.

B. only considers people who borrow on short-term basis, but not depositors.

C. considers people who need to borrow and depositors who withdraws their funds. D. only includes customers with savings account.

24. Financial institutions, acting as financial intermediaries perform all of the following,

EXCEPT:

A. Provides ways to diversify risks

B. Increase transaction costs

C. Pooling resources of small investors

D. Supply liquidity