Asked by Catherine Collins on Apr 28, 2024
Verified
Which of the following is not a characteristic of a money market instrument?
A) liquidity
B) marketability
C) low risk
D) maturity greater than 1 year
Money Market Instrument
Short-term debt instruments, typically with maturities of less than one year, traded in the money market, including treasury bills, commercial paper, and certificates of deposit.
Maturity
The expiration date of a financial instrument, at which point the principal is to be paid back to investors.
- Acquaint oneself with the aspects and goals of various market securities, including T-bills and commercial paper.
Verified Answer
EC
Emily ChumleyApr 30, 2024
Final Answer :
D
Explanation :
Money market instruments are typically short-term, highly liquid, low-risk securities with a maturity of one year or less. Therefore, an instrument with maturity greater than 1 year cannot be considered a money market instrument.
Learning Objectives
- Acquaint oneself with the aspects and goals of various market securities, including T-bills and commercial paper.