Finance

Tutorial (Week 2) True or False Questions 1. Money is a medium of exchange that includes belongingss of divisibility and a store of value. (T) 2. A forward-looking monetary organization may be said to lay out three major components: monetary institutions, instruments and markets. (T) 3. The time-pattern of the cash flows impute of a fiscal asset refers to the term to maturity of an instrument. (F) 4. A well-functioning monetary system is expected to allocate savings to the most cost-efficient users of the funds. (T) 5. pecuniary assets incorporate a number of attributes. The risk attribute refers to the probability that suppliers of funds will not purchase a particular asset when it is restitutiond. (F) 6. Monetary policy is the actions of a early bank that influence the level of interest rates in come out to achieve certain frugal activities. (T) 7. A ruler role of enthronisation banks is to gather deposits savings from customers and take into account lo ans to their sell clients. (F) 8. Finance companies are examples of contractual savings institutions. (F) 9. The matching teaching contends that short-term assets should be funded with equity. (F) 10. Equity in a grass represents an ownership position that is represented by the issue of run-of-the-mine shares.

(T) Answers for Short Essay Questions 1. The component parts of a financial system are financial institutions such as banks and indemnity offices. Financial instruments that are shares, term deposit and loan. Financial markets for example, gillyflower market and foreign exchange market. The financial system supports frugal transactions, encourages savings wh ich provides funds for investment, provides ! a range of investment opportunities, and provides a range of borrowing alternatives, efficient allocation of resources for sparing addition and regulatory regimes provide strength and stability to a financial system. 2. (a) Money is a financial asset that facilitates financial and economic transactions. Money act...If you want to get a lavish essay, order it on our website: OrderEssay.net

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