Question 106 Poor communication of the intent of the central bank is least likely to lead to: A) uncertainty among market participants. B) instability in financial markets. C) policy decisions that surprise markets. D) information asymmetry. Question 107 Embedded options that favor the bondholder are least likely to include: A) conversion provisions. B) a floor under a floating coupon rate. C) a put option. D) accelerated sinking fund provisions.
Question 108 The fully-taxable equivalent yield on a 6% municipal security for an investor in a 35% marginal tax bracket is closest to: A) 17.1%. B) 3.9%. C) 6.0%. D) 9.2%.
Question 109 Inflation risk is most accurately described as: A) the risk that the purchasing power of a bond’s cash flows will be less than expected. B) the risk that a bond’s cash inflows are less than expected. C) the effect of changes in the market rate of interest on a bond’s value. D) the effect of changes in interest rates on fixed-income securities with embedded options. Question 110 Which of the following statements about U.S. debt securities is most accurate? A) Government agency issues are backed by the full faith and credit of the Treasury. B) General obligation bonds are backed by the full faith and credit of the issuer. C) Municipal bond guarantees apply to principal but not interest payments in the event of default. D) Coupon strips refer to the principal payments derived from stripped bonds or notes. | 
发表于 2008-11-6 16:50
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