金融市场与机构Madura第九版题库ch22.doc

Chapter 22 Finance Operations 1. ___________ finance companies concentrate on purchasing credit contracts from retailers and dealers. A) Consumer B) Sales C) Commercial D) none of the above ANSWER: B 2. Which of the following is not a source of finance company funds to support operations? A) loans from banks B) commercial paper C) federal funds D) bonds ANSWER: C 3. When a finance company’s assets are ___________ interest rate sensitive than its liabilities and when interest rates are expected to ___________, bonds can provide long-term financing at a rate that is completely insulated from rising market rates. A) less; increase B) less; decrease C) more; increase D) more; decrease ANSWER: A 4. Finance companies differ from commercial banks, savings institutions, and credit unions in that they A) normally do not obtain funds from deposits. B) focus on financing acquisitions by companies. C) focus on providing residential mortgages. D) use most of their funds to purchase stocks. ANSWER: A 5. Which of the following is not a main source of funds for finance companies? A) bank loans B) commercial paper issues C) bonds D) deposits ANSWER: D 6. Finance companies are more likely to issue bonds when their assets are presently ______ interest-rate sensitive than their liabilities, and when interest rates are expected to ______. A) more; decrease B) less; increase C) more; increase D) less; decrease ANSWER: B 7. If finance companies were confident about projections of ______ interest rates, they may consider using the funds obtained from issuing bonds to offer loans with ______ rates. A) declining; variable B) rising; fixed C) rising; variable D) A and B ANSWER: C 8. Finance companies would prefer to increase their longterm debt most once interest rates A) have declined. B) have increased. C) were stable for several years. D) were projected to decline. ANSWER: A 9. The main competition for finance companies in the consumer loa