All of the Following Would Be Viable Securities to Purchase

question 78

Multiple Choice

All of the following would be viable securities to purchase with temporary excess cash except:

• A)a recently issued 30 year Baa corporate bond
• B)U.S.Treasury bill
• C)the commercial paper of General Motors Acceptance Corporation
• D)a repurchase agreement

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Definitions:

Residential Mortgage Loan

A loan secured by real property through the use of a mortgage note, typically used to purchase residential properties.

Mortgage Broker

A professional intermediary who helps borrowers find the best mortgage deals by comparing offers from different lenders.

Effective Rate of Interest

The actual rate of interest earned or paid on an investment or loan, accounting for the effect of compounding.

Nominal Interest Rate

The rate of interest before adjustment for inflation, representing the face value of financial transactions.