Multiple choice

1. A competitive bid in the Treasury securities auction market has all of the following characteristics except: 

a. the bidder specifying the quantity of bills desired

b. the price the investor wishes to pay

c. large, institutional investors

d. bids for a maximum of $5,000,000

2. All of the following represents a characteristic of money market instruments except: 

a. low default risk 

b. guaranteed marketability

c. debt obligation 

d. short term

3. The money market security with the lowest yield to the investor is likely to be:

a. a Treasury bill.

b. commercial paper.

c. agency issues.

d. negotiable CDs

4. All of the following money market participants are major investors in money market securities except:

a. Federal Reserve banks. 

b. the U.S. Treasury.

c. commercial banks. 

d. corporate business.