Q1. Which of the following is a money market transaction?

a. Private placement of shares

b. Reserve Bank Notes

c. Debentures

d. Corporate bonds

Q2. Which of the following is not an example of intermediated finance?

a. Commercial Bills

b. Bank loans

c. Corporate bonds

d. Inventory for floor plan finance

Q3. Which of the following is not a financial intermediary?

a. Commercial Banks

b. Insurance Companies

c. Superannuation Company e.g Fiji National Provident Fund

d. Stock Market

Q4. Which of the following is correct about preference shares?

a. Preference shares always have voting rights

b. If the company does not have the funds to pay the preference dividend, the right of the preference shareholders to collect that dividend continues

c. Preference shares always have a maturity date

d. Preference shares do not have preferential return on capital on winding-up of company

Q5. When deciding the sources of funds (debt or equity), which of the following is not correct?

a. Debt financing places an organisation in high financial risk

b. Lenders are able to exercise considerable influence when a firm defaults

c. Funds raised in the market as debt will be often cheaper than equity funds

d. Interest payments are tax deductible