Term
| The term "money market" is a what? (1 word) |
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Definition
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Term
| Are money markets usually sold in large or small denominations? |
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Definition
| large; usually $1,000,000 or more |
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Term
| What funds exist for smaller investors? |
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Definition
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Term
| What kind of risk does a money fund have? |
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Definition
| they have a low default risk with an exception in September 2008 |
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Term
| What is the time to maturity for a money fund? |
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Definition
They mature in one year or less from their issue
date. Weighted average maturity for funds must
be <90 days. |
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Term
| True or False: Banks have an information advantage on the credit worthiness of participants |
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Definition
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Term
| What should banks handle the needs of? |
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Definition
| short term deposits and short term loans |
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Term
| What causes additional expense for banks that a money market doesn't have? |
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Definition
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Term
Fact:
Regulations on the level of interest banks could offer depositors lead to a significant growth in money markets, especially in the 1970s and 1980s |
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Definition
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Term
| T-bills have a how many day maturity through how many months security? |
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Definition
| 28 day maturity through a 12 month maturity |
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Term
When an investor pays less for the
security than it will be worth when it
security than it will be worth when it
matures, and the increase in price provides a
return. This is common to short-term
securities because they often mature before
the issuer can mail out interest checks. |
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Definition
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