Question

A when-issued Treasury security involves

		a. An on-the-run security’s going off the run
		b. A forward contract in which a dealer promises to deliver a new Treasury security once it is issued
		c. The Treasury’s promising to award a security to a noncompetitive bidder
		d. The Treasury’s promising to award a security to a competitive bidder Helping to stimulate investor interest in Treasury securities is a. Regular auctions of Treasury securities b. Transparent and fair auctions c. All winning bids get the lowest successful bid price (the cutoff price) d. All of the above Private-label mortgage pools include a. Jumbo mortgages b. Alt-A mortgages c. Subprime mortgages d. All of the above Risks associated with Ginnie Mae MBSs arise from a. Defaults of the underlying mortgages b. Default by Ginnie Mae c. Unpredictable cash flows from prepayments d. Lack of collateralization Growth in the asset-backed commercial paper market owed to a. SEC encouragement b. Efforts by commercial and investment banks to move assets from their balance sheets to special-purpose vehicles (SPVs) c. Removal of regulatory barriers d. All of the above

Answer 1

A when-issued Treasury security involves -  The Treasury’s promising to award a security to a competitive bidder (Option d)

Helping to stimulate investor interest in Treasury securities is - All of the above(option d)

Private-label mortgage pools include - All of the above(option d)

Risks associated with Ginnie Mae MBSs arise from - Defaults of the underlying mortgages (option a)

Growth in the asset-backed commercial paper market owed to - Efforts by commercial and investment banks to move assets from their balance sheets to special-purpose vehicles (SPVs) (Option b)