QUESTION 4 Treasury bonds are subject to risk but are free of risk o default underwriting o default interest-rate O interest-rate: default QUESTION 5 Which of the following statements about Treasury inflation-indexed bonds is not true? o At maturity the securities pay the greater of face-value or inflation-adjusted principal O The principal amount used to compute the interest payment varies with the consumer price index O The interest rate rises when inflation occurs O The interest payment rises when inflation occurs QUESTION 6 A requirement in the bond indenture that the firm pay off a portion of the bond issue each year is called o a call provision o a restrictive covenant asinking fund a shelf registration QUESTION 7 Corporate bonds are less risky if they are O unsecured: general obligation O secured; revenue O unsecured; revenue bonds and municipal bonds are less risky if they are bonds