Question

-Money markets are used to buy and sell assets that are short-term in duration but higher risk than ordinary assets.

True or False

-Government Agency Revenue Bonds are backed by the full faith and credit of the government entity issuing the bonds.

True or False

-Bond rating agencies are separated from government and corporate organizations to ensure they possess no conflicts of interest.

True or False

-Equity can be valued in a similar fashion to real estate.

True or False

Answer 1

1. Given statement about money markets are TRUE because they can be highly risky because of fluctuations in the shorter term and they will be providing mostly unsecured kind of lending so this money market instruments are generally more risky than the original assets.These have various kinds of reinvestment risk and short term interest rate fluctuation risk associated with them. This also needs the business to pay in the shorter frame so it is highly risky.

money market instruments are generally offered for the shorter period of time ranging from 3 months to 1 year.

Given a statement about money market instrument is TRUE.