Question 1:

1.) True or false? The financial sector is involved with the production and output generated in the economy.

2.) True or false? The purpose of the financial system is to facilitate the flow of funds from savers to borrowers in the most efficient manner.

3.) True or false? A financial claim is an I..O.U. from a deficit spending unit.

4.) True or false? An investment banker specializes in helping DSUs bring their primary security issues to market.

5.) True or false? Deposits in a credit union share account owned by a household are an example of direct finance.

6.) True or false? Mortgages are capital market debt securities.

7.) True or false? The New York Stock Exchange is an example of a secondary market.

8.) True or false? The money market provides liquidity for deficit units; the capital market finances economic growth.

9.) True or false? Money markets are short-term debt.

10.) True or false? The money market is a dealer market, not an exchange, and has no specific location.

11.) True or false? The money market is where liquidity is bought and sold.

12.) True or false? When common stock is listed on an exchange, exchange members may trade the listed stock on the floor of the exchange.