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18 Cards in this Set
- Front
- Back
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When computing the present value of a future sum of money, increasing the discount rate will:
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Decrease the present value
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If the coupon rate on a bond is 10% and the yield-to-maturity is 9%, the bond will sell at:
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A Premium
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If market rates have fallen, and issuer is most likely to exercise:
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A call provision
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Which of the following is likely to reduce the rating on a bond?
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A sinking fund provision
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Assuming an increase in interest rates, a bond will pay off at ________ at maturity.
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Par Value
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Which of the following bonds would demand the highest interest rate?
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Subordinated Debenture
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Unfunded pension liabilities are associated with defined ____ plans.
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benefit
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In a Chapter 11 bankruptcy, a company has 120 days to submit a __________
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plan of reorganization
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the intrinsic value of a stock is using which method?
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Dividend growth model
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Increasing the diversity of your stock portfolio reduces which of the following types of risk?
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unsystematic
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Beta measures the _______
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volatility, risk, potential return, and performance of a stock
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Market Risk Premium is a function of :
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expected market return and the risk-free rate
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If you purchase part of a new issue of IBM stock, the transaction takes place in the ______ market.
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primary
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the differences between the spot and futures market is determined by
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when goods change hands
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Which of the following is not a financial intermediary?
Mutual fund bank stock exchange credit union pension fund |
stock exchange
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if the coupon rate on a bond s 8% and the yield-to-maturity is 9%, the bond will sell at _____
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discount
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A bond issuer is more likely to excercise a call provision when market rates have ____
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fallen
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The coupon rate on a sinking ufnd bond will tend to be higher because of the interest the issuer is earning on the money in the sinking fund. t or f?
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false
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