Question 1 Time left 1:59:52 The yield to maturity, current yield, and rate of return are Not yet answered Marked out of 4.00 Flag question O a. equal only for bonds traded at par value. a. O b. different only for bonds with higher maturities. O OC. the same for all discount bonds, but not coupon bonds. O d. interchangeable measures of the same interest rate. Question 2 A corporate bond will typically sell at a lower price than an equivalent sovereign bond with the same maturity and payment structure because of Not yet answered Marked out of 4.00 Flag question a. duration risk. . O b. credit or counterparty risk. O c. currency risk. od O d. interest rate risk. Question 3 A downward-sloping yield curve is evidence Not yet answered O a. Marked out of 4.00 both the preferred habitat and liquidity premium theories of the yield curve, because the expectations theory suggests it is always perfectly flat. ob. for the expectations theory of the yield curve because it is the only theory that accounts for a downward sloping yield curve. Flag question c. for none of the theories unless we have more information about what short term interest rates are expected to be in the future. od . O d. for the preferred habitat theory of the yield curve because none of the other theories are consistent with this observation. Question 4 In the academic literature on the pricing of securities, proponents of market efficiency rely on the theory of rational expectations to claim that Not yet answered Marked out of 4.00 P Flag question O a price changes are the result of irrational behaviour on the part of market participants who don't have the right information. b. price changes are impossible to forecast because all available information is already incorporated in current prices. OC. price changes are impossible because market participants do not make mistakes in pricing securities. O d. price changes are predictable in advance if all market participants have access to the same information. Question 5 Which of these statements is true? Not yet answered Marked out of 4.00 a. Only the combination of bank's balance sheet and income statement provides enough information to determine whether it is a desirable investment opportunity. Flag question Ob A bank's balance sheet provides sufficient information for investors to determine whether it is a desirable investment opportunity OC. A bank's income statement provides sufficient information for investors to determine whether it is a desirable investment opportunity Od Even when combining the bank's balance sheet and income statement does not provide investors with sufficient information to determine whether it is a desirable investment opportunity
