13.The phenomenon known as "flight to quality" causes yields on government bond and corporate bonds Question 13 options: to rise in tandem. to fall in tandem. to move in opposite directions. to become less volatile.

Question 14.The bond market is considered bearish when Question 14 options: market interest rates are low or falling. market interest rates are high or rising. the risk-free rate of return exceeds the required rate of return. more bonds are called than issued over a given period of time.

Question 15.A single bond issue with multiple maturity dates is called a Question 15 options: callable bond. premium bond. serial bond. term bond. Question 16 Under which bond provision is the issuer required to retire portions of the bond issue prior to maturity? Question 16 options: call feature refunding provision subordination clause sinking fund feature

Question 17. Most bonds pay interest Question 17 options: annually. semi-annually. quarterly. monthly.

Question 18. A bond which has a deferred call Question 18 options: does not have to be redeemed when it reaches maturity. can be retired at any time prior to maturity provided six months notice is given. cannot be retired for a specific period of time after which it can be retired at any time. can be retired at any time during the initial call period but after that time can not be redeemed prior to maturity.

Question 19. Debt securities issued by the Federal Home Loan Bank, the Student Loan Marketing Association and the Government National Mortgage Association are known as Question 19 options: agency bonds. organizational bonds. municipal bonds. Treasury bonds.

Question 20. The required return on a bond is equal to Question 20 options: the real rate of return plus a risk premium plus an expected inflation premium. the real rate of return plus the coupon rate plus an inflation rate. the risk-free rate plus a risk premium plus an expected inflation premium. the real rate plus a risk premium.

Question 21.The single most important factor that influences the behavior of market interest rates is Question 21 options: inflation. business profits. the supply of new bonds. the stock market.

Question 22.Long-term bonds are ________ than short-term bonds. Question 22 options: less risky more liquid subject to more uncertainty less sensitive to interest rate changes

Question 23. A $1,000 par value, 12-year annual bond carries a coupon rate of 7%. If the current yield of this bond is 7.995%, its market price to the nearest dollar is Question 23 options: $876. $925. $1,075. $1,125.

Question 24.The current yield on a bond is most similar to Question 24 options: the discount rate on a Treasury Bill. the effective annual rate on a certificate of deposit. the dividend yield on a stock. the internal rate of return if the bond is held to maturity.

Question 25.Yield-to-call is Question 25 options: commonly used for bonds with deferred-call provisions. calculated using the time to call and the par value of the bond. based solely on the call premium and ignores interest payments. always less than the yield-to-maturity.