1- Which of the following most closely related to the concept of "the interest rate?"

1. The coupon rate
2. The current yield
3. The yield to maturity
4. None of the answers here

2- An Investor with a 10 year investment horizon current has $10,000 invested in bonds with a duration of 75. he invests an additional , which of the following bonds would best immunize his portfolio?

1. A bond with duration of 15
2. A bond with duration of 10
3. A bond with duration of 12.50

3- Given the following government bond yields: one-year2and five-year, 8%. What is the three-year government bond yield one would linearty interpolate from this information ?

1. None of the answers here
2. 3%
3. 4.5%
4. 5%

4- with an investment horizon of years is considering purchasing a bond with a Macaulay Duration of the investor goes through with the purchase she will be subject to risk and be worse off interest rates

1. Interest rate; go down
2. None of the answers here
3. Reinvestment; go up
4. Reinvestment; go down

5- UK Government Benchmark Bond: 2coupon 10 year maturity, priced at $ UK Corporate Bond: 3% coupon 10 year maturity priced at $73.94 If the two bonds above pay interest semiannually, the G-spread on the UK corporate bond closest to

1. 176 bps
2. 300 bps
3. 88bps
4. 10 bps

6- Yield spreads are often calculated as the difference between the interest rate on a risky bond and the interest rate on

1. Commercial paper
2. Bankers acceptances
3. None of the answers here
4. Mortgage backed securities

7-What is the duration of a 20 year zero - coupon bond?

1. 15
2. 20
3. None of the answers here
4. 10

8- An investor, with an investment horizon of 10 years is considering purchasing bond with a Macaulay Duration of 2. investor goes throug with the purchase she will be subject to risk and be worse off interest rates

1. Interest rate; go down
2. None of the answers here
3. Reinvestment; go up
4. Reinvestment; go down

9-Information regarding Bond Z sold for settlement on August , 2014 Annual Coupon 5% Coupon Payment Frequency Semiannual Interest Payment Dates14 March and 14 September Maturity Date 14 September 2016 Daycount Convention 30/350 Annual Yield -to-Maturity 4% What is the full price, at settlement of Bond Z listed above?

1. None
2. 103.70
3. 104.11
4. 101.90

10- A bond has a modified duration of 12 and a convexity of interest rates go up by 100 bps, what will the percent change the full price of the bond be, approximately ?

1. -12.94
2. 12.94
3. None of
4. 13