A Financial Intermediary Has Two Assets in Its Investment Portfolio

question 45

Multiple Choice

A financial intermediary has two assets in its investment portfolio. It has 35 percent of its security portfolio invested in one-month Treasury bills and 65 percent in real estate loans. If it liquidated the bills today,the bank would receive $98 per hundred of face value. If the real estate loans were sold today,they would be worth $85 per 100 of face value. In one month,the real estate loans could be liquidated at $94 per 100 of face value. What is the intermediary's one-month liquidity index?

• A)0.93
• B)0.92
• C)0.91
• D)0.90
• E)0.89

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Definitions:

Pointers

Variables that store the memory address of another variable.

Relational Operators

Symbols that are used to compare two values and determine the relationship between them.

Pointers

Variables in programming that store memory addresses of other variables, allowing for indirect manipulation of those variables.