Which of the Following Observations Concerning Repurchase Agreements Is NOT

question 109

Multiple Choice

Which of the following observations concerning repurchase agreements is NOT true?

• A)They can be viewed as collateralized federal funds transactions.
• B)The RP market is a highly liquid and flexible source of funds for DIs needing to increase their liabilities and to offset deposit withdrawals.
• C)Unlike fed funds,these transactions cannot be rolled over each day.
• D)It is difficult to transact an RP borrowing late in the day.

---

Definitions:

Profit Margin

A financial metric indicating the percentage of revenue that exceeds the costs of goods sold, highlighting the profitability of a business or product.

Fair Pricing

The degree to which both businesses and customers believe that the pricing is reasonable.

Reasonable

Based on good sense and sound judgment; fair and sensible.

Skimming

A high pricing strategy, generally used for new products or services that face very little or even no competition.