1. Which of the following statements is most likely to be correct?

A. An on-the-run Treasury issue tends to sell at a lower price.

B. An on-the-run Treasury issue is the most recent issue for a maturity.

C. An on-the-run Treasury issue tends to sell at a higher price.

2. The following 2 statements were made:

Statement 1: "Money market accounts are wholesale funds available for banks."

Statement 2: "A withdrawal penalty is imposed if the depositor realizes a negotiable certificate of deposit before maturity."

A. Both statements are correct.

B. Exactly one of the statement is correct.

C. None of the statements is correct.

3. A 4% semi-annual pay bond with a maturity of 10 years was sold to yield 6%. One year passes and interest rates remained unchanged at 6%. What will have happened to the bond's price during this period?

A. It will have increased.

B. It will have decreased.

C. It will have remained constant.