Question
Betsy is considering purchasing Apple corporate bonds, but she is concerned that the Apple might not pay the promised interest and / or principal payments
- Betsy is considering purchasing Apple corporate bonds, but she is concerned that the Apple might not pay the promised interest and / or principal payments as expected. Which one of the following represents additional compensation provided to Betsy for bearing this risk?
Interest rate risk premium
Illiquidity premium
Inflation premium
Default risk premium
2.Ted is the manager of his local bank. He is concerned that interest rates may rise adversely affecting his long term mortgage loans. Which one of the following compensates bond investors for bearing this risk?
Default risk premium
Interest rate risk premium
Real rate of return premium
Illiquidity risk premium
3.
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Entrepreneurial Finance
Authors: Chris LeachJ LeachRonald Melicher
3rd Edition
0324561253, 9780324561258
