Question

2 of 5 5. Depository institutions include: a. Banks b. Thrifts c. Finance companies d. All of the above e. a and b only Answer: 6. Which of the following observations concerning hedge funds is NOT true? They are pooled investment vehicles. b. They are subject to less regulatory oversight compared with mutual funds. c. They usually take significant risk. d. They have to disclose their activities to third parties. Answer: 7. What is common to both hedge funds and mutual funds? SEC Registration b. Disclosure norms c. Management fees d. Performance fees e. Investor profiles Answer: Please answer the following questions. 1. (6 points) A bank's beginning balance of Allowance for Loan Losses in 2019 is $1,000 million. Its net loan charge-offs during 2019 is $120 million, and its provision for loan losses in 2019 is $200 million. What is the ending balance of the Allowance for Loan Losses in 2019? 2. (10 points) Calculate the duration of a 3-year corporate bond with a yield of maturity 8%/year, coupon rate 6%/year, and annual interest payment? Use $1000 as face value.

Answer 1

5.

option e "a and b only " is correct.

option a is correct

Banks are depository institutions they accept deposit from customers. Banks includes both Commercial banks, savings banks

Option b is also correct

Thrift is like a credit union and mutual saving banks. They provide various savings and loan services. They borrow money from the Federal Home Loan system so they can pay a higher interest rate to the member.

Option c is incorrect

Financial companies are not Depository institution. Financial companies include insurance companies, a brokerage firm that sells and buy securities they do not collect deposits from their customer.