Bond Valuation

Bond Valuation

University

20 Qs

quiz-placeholder

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Bond Valuation

Bond Valuation

Assessment

Quiz

Business

University

Medium

Created by

Logeswary Logeswary A/P Mariappan

Used 307+ times

FREE Resource

20 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Long-term bonds are ... than short-term bonds.

more liquid

less risky

less sensitive to interest rate changes

subject to more uncertainty

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

If a bond's yield to maturity is lower than its coupon rate, the bond will sell at a discount.

True

False

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

As a bond approaches its maturity date, its price necessarily approaches par value.

True

False

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Which of the following statements is FALSE regarding bonds?

If the par value is lower than the market price, then the yield-to-maturity must be lower than the coupon rate.

If the market price is lower than the par value, then the coupon rate must be lower than the yield-to-maturity.

Both A and B are false.

None of the above are false.

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

When the price of bond is calculated below its par value, it is classified as...

classified bond

discount bond

compound bond

consideration earnings

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a bond?

an agreement or friendship

binding security

something that binds, fastens, confines, or holds together

a type of debt a company issues to investors

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

When you purchase a municipal bond, you are:

buying a portion of a municipality

diversifying your portfolio

investing in an index fund

loaning money to a municipality

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