Question
I'm sorry for the length of the question as my professor does long 5 part questions to help us better understand the concepts together. Thank
I'm sorry for the length of the question as my professor does long 5 part questions to help us better understand the concepts together. Thank you for your help in advance!
A) Which of the following institutions does NOT borrow from investors using bonds?
The U.S. Federal Government.
State governments.
Local governments.
Businesses.
All of these institutions use bonds.
B) When you invest in a bond, the regular payment of interest that you receive is called a...
maturity
coupon
face value
par value
price
C) If you can buy a bond in the market and the price is the same as its face value, we say that the bond is trading at...
a discount
a premium
par
the bond price is never the same as the face value
the bond price is always the same as the face value
D) All else being equal, if a bond's interest rate increases, we will see that...
its price decreases.
its price increases.
its face value decreases.
its coupon rate increases.
its maturity decreases.
E) The portion of the bond total return due to collecting coupon payments is called...
Current Yield
Capital Gains Yield
Yield To Maturity
Dividend Yield
Yield to oncoming traffic
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