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98. A bond with 14 years to maturity is selling for $1,070 and has a yield to maturity of 10.06
percent. If this bond pays its coupon payments semi-annually and par value is $1,000, what is the
bond's annual coupon rate?
99. A bond with 23 years to maturity is selling for $991 and has a yield to maturity of 8.12
percent. If this bond pays its coupon payments semi-annually and par value is $1,000, what is the
bond's annual coupon rate?
100. All of the following items would need to be included in the bond's indenture agreement
EXCEPT:
101. Which of the following is not a correct statement?
102. Which of the following would NOT be an example of an agency bond?
103. Which of the following statements is correct?
104. Which of the following statements is correct?
105. Which of the following bonds will have the largest percentage increase in value if interest
rates decrease by 1 percent?
106. Rank the following bonds, from highest to lowest interest rate risk: 2-year zero coupon, 2-
year 5 percent coupon bond, 30-year 5 percent coupon bond, 30-year, zero coupon bond.
107. Which of the following statements is correct?
108. Under which conditions will an investor demand a larger return (yield) on a bond?
109. Which of the following statements is correct?
110. If a bond is selling at a premium, then:
111. The bond's annual coupon rate divided by its market price is referred to as the:
112. Possible shapes for the yield include all of the following EXCEPT:
113. Possible shapes for the yield curve include all of the following EXCEPT:
114. If a bond is selling at a discount, which of the following statements is correct?
115. If a bond is selling at par value, which of the following statements is correct?
116. To increase the liquidity for the home mortgage market, Fannie Mae and Freddie Mac
purchased home mortgages from banks and other lenders. They combined the mortgages into
diversified portfolios of loans and issued:
117. Under what conditions is a bond likely to be called?
118. A 30-year bond with an 8 percent coupon has a yield to maturity of 6 percent. The bond
could be called in seven years and if called would generate a yield to call of 5.75 percent. What is
this bond's call premium? Assume the coupon payments are made annually and par value is
$1,000.
119. A 15-year bond with a 10 percent coupon has a yield to maturity of 8 percent. The bond
could be called in four years and if called would generate a yield to call of 6 percent. What is this
bond's call premium? Assume the coupon payments are made semi-annually and par value is
$1,000.
