1.Which of the following debt instruments is likely to be the most junior in a company's capital structure?

A.A conventional loan not secured by any collateral

B.A convertible bond

C.A securitization of the company's receivables

D.A senior bond secured by a second lien on the company's headquarters

2.You have purchased $8,000,000 (par amount) of a floating rate bond that pays interest at a fixed spread of .70% above 6-month LIBOR.If 6-month LIBOR at the last coupon reset for this bond was 2.05%, and the applicable period is 183 days, the amount of interest you will receive on the next coupon payment date is closest to:

A.$111,800

B.$110,300

C.$83,350

D.$82,250

3.You observe the 12-month and 18-month zero coupon rates for U.S. Treasury securities are 1.95% and 2.25%, respectively.Assuming arbitrage free markets and no friction costs, the implied 6-month rate in 12 months' time should be closest to:

A.1.42% B. 2.10% C. 2.85%

D. 3.16%

4.Consider a $1,000 corporate bond with a 5.5% coupon that pays interest quarterly and matures in five years.If its yield to maturity is 3%, its price would be closest to:

A.$891.36

B.$1,030.56

C.$1,114.49

D.$1,115.68

5.The modified duration of a 6-year bond with a 3.5% annual coupon and a yield to maturity of 4.80% is closest to:

A.4.80 years B. 4.90 years C. 5.00 years

D. 5.50 years

6.You own a bond portfolio comprised of 25% in U.S. Treasury zero coupon bonds (avg. duration of 7.5 years), 30% in corporate bonds (avg. duration of 5 years), 20% in mortgage-backed securities (avg. duration of 3.5 years), and 25% in floating rate bonds, all of which are about to reset their interest rates at market levels.The effective duration of your portfolio is closest to:

A.3.50 years B. 3.80 years C. 4.00 years

D. 4.10 years