8/24/2020 Practice Quiz M4 (Ungraded)

My courses ▶ (20/07) MScFE 560 Financial Markets (C20-S3)

▶ Module 4: Fixed Income and Bond Markets ▶ Practice Quiz M4 (Ungraded)

Started on Monday, 24 August 2020, 5:59 PM

State Finished
Completed on Monday, 24 August 2020, 10:51 PM
Time taken 4 hours 52 mins

Question 1
Complete

Not graded

Consider the following statements:

Statement A: Bond coupon amounts can be calculated according to the

bond’s interest rate.
Statement B: The different between short-term and long-term interest
rates is known as the spread.

Which of the statements given above is correct?

Select one:
Neither statement A nor B 
Only statement A
Only statement B

Both statement A and B

Your answer is incorrect.

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8/24/2020 Practice Quiz M4 (Ungraded)

Question 2

Complete

Not graded

Consider the following statements:

Statement A: The bond markets, where businesses raise capital, can also
be called the capital markets.
Statement B: It is risky for a business to be funded by less equity than
debt.

Which of the statements given above is correct?

Select one:
Only statement A
Neither statement A nor B
Both statement A and B
Only statement B

Your answer is correct.

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8/24/2020 Practice Quiz M4 (Ungraded)

Question 3

Complete

Not graded

ABC corporation just issued zero-coupon bonds with a par value of $1,000. If the
bond has a maturity of 15 years and a yield to maturity of 10%, what is the
current price of the bond?

Select one:
$231.38
This question cannot be answered because the coupon payment
information is missing.
$239.39
$1,000

Your answer is incorrect.

Question 4

Complete
Not graded

What is an alternative name for bond markets, and how does it relate to its
de nition and characteristics?

Select one:
Bond markets are also called the xed-income markets, because bonds are
low risk investments that essentially x the amount of pro t earned each
period.
Bond markets are also called the xed-income markets, because the
traded instruments have speci ed promised payments.
Bond markets are also called the capital markets, because they are where
business raise capital for their business.

Bond markets are also called the capital markets, because investors can
invest by lending their capital.

Your answer is incorrect.

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8/24/2020 Practice Quiz M4 (Ungraded)

Question 5

Complete

Not graded

Consider the following statements:

Statement A: The yield-to-maturity of a defaultable bond is the overall

return a lender will get with certainty by investing in the bond.
Statement B: A yield curve illustrates the term structure of interest rates.

Which of the statements given above is correct?

Select one:
Neither statement A nor B
Only statement A

Both statement A and B

Only statement B

Your answer is incorrect.

◄ Notes 4 M4
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Live Session M4 ►

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