Reference no: EM131401063

Answer the following questions and complete the following problems, as applicable.

• Question 1:
  • Proficient-level: "Classify the following transactions as taking place in the primary or secondary markets:
    • IBM issues $200 million of new common stock.
    • The New Company issues $50 million of common stock in an IPO.
    • IBM sells $5 million of GM preferred stock from its marketable securities portfolio.
    • The Magellan Fund buys $100 million of previously issued IBM bonds.
    • Prudential Insurance Co. sells $10 million of GM common stock" (Cornett, Adair, & Nofsinger, 2016, p. 154).
  • Distinguished-level: Provide five correct responses.
• Question 2:
  • Proficient-level: "Classify the following financial instruments as money market securities or capital market securities:
    • Federal Funds.
    • Common Stock.
    • Corporate Bonds.
    • Mortgages.
    • Negotiable Certificates of Deposit.
    • U.S. Treasury Bills.
    • U.S. Treasury Notes.
    • U.S. Treasury Bonds.
    • State and Government Bonds" (Cornett, Adair, & Nofsinger, 2016, p. 154).
  • Distinguished-level: Provide nine correct responses.
• Question 3:
  • Proficient-level: "What are the different types of financial institutions? Include a description of the main services offered by each" (Cornett, Adair, & Nofsinger, 2016, p. 154).
  • Distinguished-level: Provide a definition of the term, liquidity.
• Question 4:
  • Proficient-level: "List and provide the definitions of the six factors that determine the nominal interest rate on a security" (Cornett, Adair, & Nofsinger, 2016, p. 154).
  • Distinguished-level: Identify the two factors common to all financial securities.
• Question 5:
  • Proficient-level: Define the concept, term structure of interest rates. List and describe the three theories explaining the shape of the term structure of interest rates.
  • Distinguished-level: Identify the slope of the most common yield curve for a U.S. Treasury security.