1. Interest rates and mortgage loan fees are at historic lows, name 3 reasons why some people are not taking advantages of these low rates to buy a house.
2. ***6 points*** You have applied for a fixed rate, 30-year, FHA home mortgage loan (3.5% down payment). The value of the house is $700,000. The stated annual interest rate for the mortgage loan is 4.8%. Property tax at 1% of value of home (annual). Home insurance is $100/month. What would be your monthly mortgage payment (principal, interest, insurance and property tax) if you are approved. Show all work.
3. Suppose a one-year T-Bill had an annual rate of return = 2.4%. A 6-month T-Bill had a 6-month rate of return of 1.4%. A 3-month T-Bill has a 3-month rate of return of .7%. Which T-bill had the highest annual return? (Show your calculations.)
4. A) 3 pts. Suppose the reported yield of a 171-days-until-maturity T-bill was stated in the Wall St. Journal as 498% (ADR). What was the price that T-Bill was sold at?

B) 3 pts. What was the real 171-day return on that T-bill?

C) 3 pts. What was the effective annual rate of return (EAR) on that 171-day T-Bill?

5. Find the current price of a regular corporate bond that has a coupon rate of 4.2%, 28 years until maturity, and a required rate of return of 3.6%.
6. Describe a sinking fund in a corporate bond.
7. When might a company use its call option in a bond?
8. Describe a convertible bond.
9. In the event of corporate bankruptcy, what is the priority of payments?
10. What makes Municipal Bonds desirous to some investors?
11. Describe TIPS (Treasury Inflation-Protected Securities). (Be specific.)
12. If we added Corporate Bonds, Munis, T-Notes, T-Bonds, Mortgages, and the Money Market, those debt instruments would total approximately what value?
13. In 2016, the US Capital Market had a total value of __________.
14. What are the 7 segments (categories) that comprise the capital market?