PLS ANS ALL

Item 2

Mr. Reyes up and asks why the maturity value of his RTB booking is less than what he invested. What will you tell the client? The bond was issued last August 1, 2007 and he bought the security on August 1, 2008.

1. He bought the security at a premium so he paid more because of the accrued interest and the cost of the Bond.
2. He bought the security at a premium thereby paying only for the cost of the bond.
3. He bought the security at par and has to pay for the custody fees.
4. He bought the security at a discount and has to pay for the commission.

Item 3

The clients money out in ROP is computed as:

1. Sum of face amount plus the total accrued interest on maturity
2. Face amount multiplied by price
3. Principal plus accrued interest
4. Principal multiplied by price
5. Clients total money in plus clients gain

Item 4

In bond computation, accrued term means:

1. The number of days from settlement date to the next coupon date
2. The number of days from the issue date to the next coupon date
3. The number of days from issue date to settlement date
4. The number of days from the last coupon date to settlement date
5. The number of days from settlement to maturity date

Item 5

Upon the maturity of the bond, the client will get the:

1. Face value plus all the coupon interest
2. Accrued interest plus the net selling amount
3. Principal or money out plus the last coupon interest
4. Face value plus the accrued interest
5. Face value plus the last coupon interest

Item 6

The regular tenors of Treasury Bills are

1. 92,184.364
2. 90,180.360
3. 91,182.364
4. 90,181.364
5. 91,183.365

Item 7

All of the following securities offer good opportunity to profit to when interest rates are going down, but which would provide the most profit if interest rates go down?

1. 3 year RTBs
2. 1 year TBills
3. 180 day Tbills
4. 3 month Tbills
5. 1 year commercial paper

Item 8

You are selling bonds at PAR if

1. The price of the bond is 100
2. The selling price of the bond is below 100
3. The selling price of the bond is above 100
4. The YTM is equal to the coupon rate
5. A and D

Item 9

You are selling bonds at a discount if

1. The selling YTM is > the coupon rate
2. The selling of YTM is < the coupon rate
3. The selling YTM is equal to the coupon rate
4. The face value is equal to the clients cash out
5. The par value is > the clients cash out

Item 10

Minnie bought USD120K of ROP32 at par 36 days after the insurance date. His cash-out was USD120,765.00. The coupon rate of the bond is 6.375%. At what price did he acquire the bond?

1. 107.650
2. 100.00
3. 106.375
4. 120.00
5. 110.00

Item 11

Charity foundation, a tax exempt institution invested through bank ABC Php100MM in BSP SDA for 30 days at 5% gross, how much is client suppose to receive upon maturity?

1. Php100,333,333.33
2. Php100,416,666.66
3. Php100,412,087.91
4. Php100,329,670.33
5. Php100,400,000.00

Item 12

Walt decided to buy USD100k of ROP bonds for settlement on the coupon payment date at 97.75 How much is his cash-out?

1. USD 100,00
2. USD 97,750
3. USD 102,250
4. USD 197,750
5. Not enough information

Item 13

For an 8% bond with a par value of $1,000 and a market value of $1,200 what is the current yield?

1. 6.67%
2. 8.00%
3. 12.00%
4. 14.67%
5. 28.00%

Item 14

What would be the accrued interest for a 5% of $1,000 bond settled on July 15^th with payable dues of April 15^th and October 15^th?

1. $10.00
2. $12.50
3. $25.00
4. $50.00

Item 15

If the yield on T-bills is 4% and it increases by 10 basis points, what is the new yield?

1. 4.01%
2. 4.10%
3. 4.40%
4. 5.00%
5. 5.10%

Item 16

For an 8% bond with a par value of $1000 and a market value of $1200 what is the nominal yield?

1. 4.00%
2. 6.00%
3. 6.67%
4. 8.00%

Item 17

What is the approximate yield to maturity for a 7%, $1000 bond purchased for $1150 and maturing in six years?

1. 3.64%
2. 4.20%
3. 6.67%
4. 7.00%
5. 6.44%

Item 18

What is the principal investment in an ROP bond if the coupon interest is US$3,281.25 every 6 months and the coupon rate is 8.75%?

1. $50,000
2. $60,000
3. $65,000
4. $75,000
5. $80,000

Item 19

How much would be paid in principal and interest over the lifetime of a 20-year bond with a par value of $1000

1. $800
2. $1400
3. $1800
4. $2000

Item 20

For a 6% ten-year corporate bond with a par value of $1000 purchased at $800, what is the approximate yield to maturity?

1. 6.00%
2. 7.50%
3. 8.89%
4. 10.00%

Item 21

What is the equivalent taxable bond yield for an 8% tax exempt bond for an investor in the 28% tax bracket?

1. 5.76%
2. 6.25%
3. 10.24%
4. 11.11%

Item 22

What is the capital gain on a $1000 bond issued at $800 sold for $950 after a $50 of the original issue discount had accrued?

1. $25
2. $50
3. $75
4. $100

Item 23

What is the approximate yield to maturity for a 7%, 1000 bond purchased for $800 and maturing in ten years?

1. 7%
2. 8%
3. 9%
4. 10%

Item 24

How many months interest are paid for a bond issued January 1, 2007 and the first coupon April 1, 2007

1. 1 month
2. 2 months
3. 3 months
4. 6 months

Item 25

What is the coupon rare of the USD50K ROP bond if the coupon payment is USD1,937.50 every 6 months?

1. 5.75%
2. 6.75%
3. 7.75%
4. 8.75%
5. 9%