1. At any given time, the yield curve is affected by all of the following EXCEPT

A. inflationary expectations.;

B. the approximate yield formula.;

C. short- and long-term supply and demand conditions.

D. liquidity preferences.;

 

2. Using the present-value method, all of the following are needed to value a bond EXCEPT

A. the issue's bond rating.

B. the par value.;

C. the number of years until maturity.;

D. the annual coupon payment.;

 

3. What is the current yield of a $10,000 bond bearing a 14% coupon rate and having a current market price of 95?

A. 14.74%;

B. 15.36%;

C. 14.00%;

D. insufficient information is provided.

 

4. The rate of return which indicates the return an investor can expect to earn by holding a bond over a period of time that is less than the life of the issue is known as

A. bond equivalent yield (BEY)

B. expected return;

C. yield-to-maturity;

D. promised yield; 

 

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