Instruments of Money Market

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6. What is the typical maturity period for a certificate of deposit?

a) 30 days

b) 60 days

c) 90 days

d) 180 days

Answer: d) 180 days
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7. Which of the following instruments involves the sale of securities with a simultaneous agreement to repurchase them at a later date?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: d) Repurchase agreements
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8. Repurchase agreements are commonly used in which market?

a) Stock market

b) Bond market

c) Money market

d) Foreign exchange market

Answer: c) Money market
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9. Which of the following instruments offers investors a fixed interest rate for a specific period of time?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: c) Certificates of deposit
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10. Which of the following instruments is considered to be the safest and most liquid in the money market?

a) Treasury bills

b) Commercial paper

c) Certificates of deposit

d) Repurchase agreements

Answer: a) Treasury bills
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