1.What is the role of a broker in security transactions? How are brokers compensated?
2.What is a Treasury bill? How risky is it?
3.Would there be positive interest rates on bonds in a world with absolutely no risk (no default risk, maturity risk, and so on)? Why would a lender demand, and a borrower be willing to pay, a positive interest rate in such a no-risk world?
4.Define intermediation.
5.What can a financial institution often do for a surplus economic unit that it would have difficulty doing for itself if the surplus economic unit (SEU) were to deal directly with a deficit economic unit (DEU)?