$1.$ The distinction between investment$-$grade debt and non$-$investment$-$grade debt is best described by differences in:

A$.$ tax status. B$.$ credit quality. C$.$ maturity dates.

$2.$ A bond issued internationally, outside the jurisdiction of the country in whose currency the bond is denominated, is best described as a:

A$.$ Eurobond. B$.$ foreign bond. C$.$ municipal bond.

$3.$ When classified by type of issuer, asset$-$backed securities are part of the:

A$.$ corporate sector. B$.$ structured finance sector. C$.$ government and government$-$related sector.

$4.$ Compared with developed market bonds, emerging market bonds most likely:

A$.$ offer lower yields. B$.$ exhibit higher risk. C$.$ benefit from lower growth prospects.

$5.$ With respect to floating$-$rate bonds, a reference rate $($such as MRR$)$ is most likely used to determine the bond$$s:

A$.$ spread. B$.$ coupon rate. C$.$ frequency of coupon payments.

$6.$ The variability of the coupon rate on a Libor$-$based floating$-$rate bond is most likely caused by:

A$.$ periodic resets of the reference rate. B$.$ market$-$based reassessments of the issuer$$s creditworthiness. C$.$ changing estimates by the Libor administrator of borrowing capacity.

$7.$ Which of the following statements is most accurate? An interbank offered rate:

A$.$ is a single reference rate. B$.$ applies to borrowing periods of up to $10$ years. C$.$ is used as a reference rate for interest rate swaps.

$8.$ An investment bank that underwrites a bond issue most likely:

A$.$ buys and resells the newly issued bonds to investors or dealers. B$.$ acts as a broker and receives a commission for selling the bonds to investors. C$.$ incurs less risk associated with selling the bonds than in a best$-$efforts offering.

$9.$ In major developed bond markets, newly issued sovereign bonds are most often sold to the public via a$($n$)$:

A$.$ auction. B$.$ private placement. C$.$ best$-$efforts offering.

$10.$ Which of the following describes privately placed bonds?

A$.$ They are non$-$underwritten and unregistered. B$.$ They usually have active secondary markets. C$.$ They are less customized than publicly offered bonds.

$11.$ A mechanism by which an issuer may be able to offer additional bonds to the general public without preparing a new and separate offering circular best describes:

A$.$ the grey market. B$.$ a shelf registration. C$.$ a private placement.

$12.$ Which of the following statements related to secondary bond markets is most accurate?

A$.$ Newly issued corporate bonds are issued in secondary bond markets. B$.$ Secondary bond markets are where bonds are traded between investors. C$.$ The major participants in secondary bond markets globally are retail investors.

$13.$ A bond market in which a communications network matches buy and sell orders initiated from various locations is best described as an:

A$.$ organized exchange. B$.$ open market operation. C$.$ over$-$the$-$counter market.

$14.$ A liquid secondary bond market allows an investor to sell a bond at:

A$.$ the desired price. B$.$ a price at least equal to the purchase price. C$.$ a price close to the bond$$s fair market value.

$15.$ Corporate bond secondary market trading most often occurs:

A$.$ on a book$-$entry basis. B$.$ on organized exchanges. C$.$ prior to settlement at T $+1.$

$16.$ Sovereign bonds are best described as:

A$.$ bonds issued by local governments. B$.$ secured obligations of a national government. C$.$ bonds backed by the taxing authority of a national government.

$17.$ Which factor is associated with a more favorable quality sovereign bond credit rating?

A$.$ Issued in local currency, only B$.$ Strong domestic savings base, only C$.$ Issued in local currency of country with strong domestic savings base

$18.$ Which type of sovereign bond has the lowest interest rate risk for an investor?

A$.$ Floaters B$.$ Coupon bonds C$.$ Discount bonds

$19.$ Agency bonds are issued by:

A$.$ local governments. B$.$ national governments. C$.$ quasi$-$government entities.

$20.$ The type of bond issued by a multilateral agency such as the International Monetary Fund $($IMF$)$ is best described as a:

A$.$ sovereign bond. B$.$ supranational bond. C$.$ quasi$-$government bond.

$21.$ A bond issued by a local government authority, typically without an explicit funding commitment from the national government, is most likely classified as a:

A$.$ sovereign bond. B$.$ quasi$-$government bond C$.$ non$-$sovereign government bond.

$22.$ Which of the following statements relating to commercial paper is most accurate?

A$.$ There is no secondary market for trading commercial paper. B$.$ Only the strongest, highly rated companies issue commercial paper. C$.$ Commercial paper is a source of interim financing for long$-$term projects.

$23.$ Eurocommercial paper is most likely:

A$.$ negotiable. B$.$ denominated in euros. C$.$ issued on a discount basis.

$24.$ For the issuer, a sinking fund arrangement is most similar to a:

A$.$ term maturity structure. B$.$ serial maturity structure. C$.$ bondholder put provision.

$25.$ When issuing debt, a company may use a sinking fund arrangement as a mean