k$.$ Describe a way to estimate the inflation premium $($IP$)$ for a t$-$year bond.

What is a bond spread and how is it related to the default risk premium? How are bond ratings

related to default risk? What factors affect a company's bond rating?

$m.$ What is interest rate $($or price$)$ risk? Which bond has more interest rate risk: an annual

payment $1-$year bond or a $10-$year bond? Why?

$n.$ What is reinvestment rate risk? Which has more reinvestment rate risk: a $1-$year bond or a $10-$

year bond?

o$.$ How are interest rate risk and reinvestment rate risk related to the maturity risk premium?

p$.$ What is the term structure of interest rates? What is a yield curve?

q$.$ Briefly describe bankruptcy law. If a firm were to default on its bonds, would the company be

liquidated immediately? Would the bondholders be assured of receiving all of their promised

payments?