5. How do you determine the value of a financial security? A. By the amount borrowed interest rate maturity rate and renewal date. _B. By calculating the pay off that debt holders can expect to receive C. The value of a security is represented by the present value of future cash flows that its expected to generate. D. All of the above 6. Why is it important for long term debt securities to have an active secondary market? LA. To provide short term liquidity for long term investments. B. It allows investors flexibility to sell them at any time before maturity C. Investors prefer highly liquid securities so that they can easily sell them whenever they want D. All of the above 7. Which answer below does not represent a money market security? A. Commercial paper B. Negotiable certificates of deposit C. Treasury bills D. Common stock 8. Which answer belowrepresents a capital market security? A. Options B. Commercial paper C. Long term corporate Bonds _D. None of the above 9. What is the role of depository institutions? A. To accept deposits from surplus units and provide credit to deficit units. B. To provide liquidity to bond markets C. To invest employees retirement funds _D. None of the above 10. Which of the following is not an nondepository institution A. Clarion Federal Credit Union B. Allstate Insurance Company C. Janus Mutual Funds _D. Fidelity Investments 11. Which best describes the lo anable funds theory? A. Interest rate movements are controlled by changes in the bond market _B. Interest rate movements are controlled by changes in the money supply C. Interest rate movements are controlled by supply and demand of loanable funds D. All of the above 5. How do you determine the value of a financial security? A. By the amount borrowed interest rate maturity rate and renewal date. _B. By calculating the pay off that debt holders can expect to receive C. The value of a security is represented by the present value of future cash flows that its expected to generate. D. All of the above 6. Why is it important for long term debt securities to have an active secondary market? LA. To provide short term liquidity for long term investments. B. It allows investors flexibility to sell them at any time before maturity C. Investors prefer highly liquid securities so that they can easily sell them whenever they want D. All of the above 7. Which answer below does not represent a money market security? A. Commercial paper B. Negotiable certificates of deposit C. Treasury bills D. Common stock 8. Which answer belowrepresents a capital market security? A. Options B. Commercial paper C. Long term corporate Bonds _D. None of the above 9. What is the role of depository institutions? A. To accept deposits from surplus units and provide credit to deficit units. B. To provide liquidity to bond markets C. To invest employees retirement funds _D. None of the above 10. Which of the following is not an nondepository institution A. Clarion Federal Credit Union B. Allstate Insurance Company C. Janus Mutual Funds _D. Fidelity Investments 11. Which best describes the lo anable funds theory? A. Interest rate movements are controlled by changes in the bond market _B. Interest rate movements are controlled by changes in the money supply C. Interest rate movements are controlled by supply and demand of loanable funds D. All of the above