Which of the following are short-term financial instruments?
A) A repurchase agreement
B) A share of Walt Disney Corporation stock
C) A Treasury note with a maturity of four years
D) A residential mortgage

Question

Quizplus · Accepted Answer

A repurchase agreement, also known as a repo, is a short-term financial instrument used in financing markets. It involves the sale of securities by one party with an agreement to repurchase them at a later date. The maturity period of a repo is usually overnight or up to a few weeks.

Other options such as shares of Walt Disney Corporation, Treasury notes, and residential mortgages are not considered short-term financial instruments as their maturity periods are longer than that of repos.

Which of the Following Are Short-Term Financial Instruments