The Key Benefit of Securitization to Financial Markets Is That

question 19

Multiple Choice

The key benefit of securitization to financial markets is that it ________.

• A) allows for the creation of tradable securities with better liquidity for financial claims that would otherwise have remained in the portfolio of financial intermediaries and therefore highly illiquid.
• B) does not allow for the creation of tradable securities with better liquidity for financial claims that would otherwise have remained in the portfolio of financial intermediaries and therefore highly illiquid.
• C) allows for the creation of tradable securities with better illiquidity for financial claims that would otherwise have remained in the portfolio of financial intermediaries and therefore highly liquid.
• D) allows for the creation of tradable securities with better liquidity for market claims that would otherwise have remained out of the portfolio of financial intermediaries and therefore highly illiquid.

Recognize the relevance of supply-chain management in service firms and the implications for outsourcing and offshoring.

Appreciate the ethical considerations and challenges in supply-chain management, particularly in a global context.

Determine how technology and innovation influence supply-chain efficiency and competitive advantage.

Understand the role of logistics and transportation choices in the effectiveness of supply-chain management.

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Definitions:

Recognize

In an accounting context, to recognize is to formally record an item within the financial statements of an entity, acknowledging its existence or occurrence.

Short-term Capital Loss

A loss realized from the sale or exchange of a capital asset held for one year or less, which can be used to offset capital gains for tax purposes.

Long-term Capital Gain

A profit from the sale of an asset held for more than a year, typically taxed at a lower rate than regular income.

Section 1245

A section of the U.S. Internal Revenue Code that defines the tax treatment of the gain from the sale of depreciable property.