1) Zero-coupon bonds has higher yield than otherwise identical coupon paying bonds.

Select one:

True False

2) The credit rating migration probability, is NOT directly associated with:

Select one:

a. How much better or worst the new credit rating is compared to the current rating b. The time interval over which the probability of migration is estimated c. The volatility of the market d. The credit rating of the bond three years ago

3) What is the main reason for the yield differences between treasury bond yield and corporate bond yield?

Select one:

a. Credit risk b. Systemic Risk c. Liquidity risk d. Interest rate risk

4) Bonds that are rated less than investment grade by bond-rating agencies is:

Select one:

a. Sovereign bonds b. Corporate bonds c. Junk bonds d. Contingency bonds

5) Accidentally deleting a portion of the dataset in the modelling process is a __

Select one: a. Erronous model risk b. Market data processing risk c. Incorrect calibration risk d. Incorrect implementation risk

6) Using a wrong formula for CAPM is a __

Select one: a. Erronous model risk b. Market data processing risk c. Incorrect calibration risk d. Incorrect implementation risk

7) Fundamental security underlying the valuation need to be priced correctly for the derivative valuation to be accurate

Select one: True False

8) Bitcoin is a fundamental security.

Select one: True False