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MCQs

Total Questions : 272 | Page 9 of 28 pages
Question 81. The rate denoted as r* is best classified as
  1.    real risk-free interest rate
  2.    real-risk free nominal rate
  3.    real-risk free quoted rate
  4.    real-risk free nominal premium
 Discuss Question
Answer: Option A. -> real risk-free interest rate
Answer: (a).real risk-free interest rate
Question 82. An inflation rate included in the bond's interest rate is the one which is the inflation rate
  1.    at bond issuance
  2.    expected in future
  3.    expected at time of maturity
  4.    expected at deferred call
 Discuss Question
Answer: Option B. -> expected in future
Answer: (b).expected in future
Question 83. A premium charged by lenders for the securities that cannot be converted into cash is classified as
  1.    required premium
  2.    liquidity premium
  3.    marketability premium
  4.    both b and c
 Discuss Question
Answer: Option D. -> both b and c
Answer: (d).both b and c
Question 84. The outstanding bonds are also classified as
  1.    standing bonds
  2.    outdated bonds
  3.    dated bonds
  4.    seasoned bonds
 Discuss Question
Answer: Option D. -> seasoned bonds
Answer: (d).seasoned bonds
Question 85. An unsecured bond that provides no lien against property as security for the bond obligation is classified as
  1.    secured bond
  2.    debenture
  3.    obligation bond
  4.    specific bond
 Discuss Question
Answer: Option B. -> debenture
Answer: (b).debenture
Question 86. The face value of the bond is $685 and the call price of bond is $378 then the value of call premium is
  1.    307
  2.    1063
  3.    2063
  4.    3063
 Discuss Question
Answer: Option A. -> 307
Answer: (a).307
Question 87. The call premium of bond is $760 and the call price of bond is $560 then face value of the bond is
  1.    200
  2.    300
  3.    1320
  4.    0.0138
 Discuss Question
Answer: Option A. -> 200
Answer: (a).200
Question 88. The unsecured bonds which are designated for only notes payable or all other debts are classified as
  1.    designated bonds
  2.    payable bonds
  3.    ordinate bonds
  4.    subordinated bonds
 Discuss Question
Answer: Option D. -> subordinated bonds
Answer: (d).subordinated bonds
Question 89. A market interest rate for specific type of bond is classified as bond's
  1.    required rate of return
  2.    required option
  3.    required rate of redemption
  4.    required rate of earnings
 Discuss Question
Answer: Option A. -> required rate of return
Answer: (a).required rate of return
Question 90. The real risk-free rate is applicable when it is expected that there will be
  1.    high inflation
  2.    low inflation
  3.    no inflation
  4.    none of above
 Discuss Question
Answer: Option D. -> none of above
Answer: (d).none of above

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