Questions
Single choice
Question1 Which one of the following statements is incorrect? An issuer will seek to sell the bill in the market at the highest yield The bank increases the creditworthiness of the bill by acting as the acceptor If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement Bills are always sold at a discount to its face value A bank can provide both a bill acceptance facility and a bill discount facility ResetMaximum marks: 1 Flag question undefined
Options
A.An issuer will seek to sell the bill in the market at the highest yield
B.The bank increases the creditworthiness of the bill by acting as the acceptor
C.If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement
D.Bills are always sold at a discount to its face value
E.A bank can provide both a bill acceptance facility and a bill discount facility
View Explanation
Verified Answer
Please login to view
Step-by-Step Analysis
Question1 Which one of the following statements is incorrect? An issuer will seek to sell the bill in the market at the highest yield The bank increases the creditworthiness of the bill by acting as the acceptor If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement Bills are always sold at a discount to its face value A bank can provide both a bill acceptance facility and a bill discount facility
Option 1: 'An issuer will seek to sell the bill in the market at the highest yield.' This statement is misleading because an issuer of a bill (such as a Treasury bill or commercial bill) typically aims to obtai......Login to view full explanationLog in for full answers
We've collected over 50,000 authentic exam questions and detailed explanations from around the globe. Log in now and get instant access to the answers!
Similar Questions
Question17 A company decides to fund its short-term cash needs by issuing a 180-day bank-accepted bill with a face value of $300,000. They approached three potential discounters - each quoting yields of 4.10%, 4.36% and 4.85% p.a. Which quote should the company accept and what amount would they raise? None of the options are correct 4.10%; $293,973.54 4.85%; $293,973.54 4.10%; $294,054.46 4.85%; $294,054.46 ResetMaximum marks: 1 Flag question undefined
Question1 Which one of the following statements is incorrect? If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement The bank increases the creditworthiness of the bill by acting as the acceptor A bank can provide both a bill acceptance facility and a bill discount facility Bills are always sold at a discount to its face value An issuer will seek to sell the bill in the market at the highest yield ResetMaximum marks: 1 Flag question undefined
Question1 Which one of the following statements is incorrect? Bills are always sold at a discount to its face value A bank can provide both a bill acceptance facility and a bill discount facility An issuer will seek to sell the bill in the market at the highest yield If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement The bank increases the creditworthiness of the bill by acting as the acceptor ResetMaximum marks: 1 Flag question undefined
Question1 Which one of the following statements is incorrect? An issuer will seek to sell the bill in the market at the highest yield Bills are always sold at a discount to its face value If a commercial bank accepts the bill this enhances the credit quality of the debt arrangement A bank can provide both a bill acceptance facility and a bill discount facility The bank increases the creditworthiness of the bill by acting as the acceptor ResetMaximum marks: 1 Flag question undefined
More Practical Tools for Students Powered by AI Study Helper
Making Your Study Simpler
Join us and instantly unlock extensive past papers & exclusive solutions to get a head start on your studies!