Short-term agreements, where the seller sells a government security to a buyer with the simultaneous agreement to buy it back on a later date at a higher price, are called
A)negotiable certificates of deposit.
B)general revenue bonds.
C)repurchase agreements.
D)asset-backed securities.

Question

Quizplus · Accepted Answer

The description given in the question corresponds to repurchase agreements, or repos, which are commonly used in the financial market to raise short-term funds. Option A refers to a type of bank deposit, option B refers to a type of bond issued by a government entity, and option D refers to a type of security that is backed by a pool of underlying assets. None of these options match the definition provided for the short-term agreements in question.

Short-Term Agreements, Where the Seller Sells a Government Security to a Buyer